Topic 1

Introduction to Managerial
Economics

2009.Spring
 Some Examples
• Boeing’s Struggle to Retain Market
Leadership
• The Disney Corporation: Expansion of
the Magic Kingdom
• In What Size Production Runs Should
Toyota Produce Its Cars?
 Relationships of Managerial
Economics to Other Disciplines
企業管理（決策問題）
Product Price and Output
傳統經濟學（理論） Make or Buy 決策理論（分析方法）
Theory of Consumer Production Technique Numerical Analysis
Behavior Inventory Level Statistical Estimation
Theory of Firm Advertising Media and Forecasting
Theory of Market Intensity Game Theory
Structure and Pricing Labor Hiring and Training Optimization
Investment and Financing Risk Analysis

管理經濟學
（應用經濟理論與決策
方法解決企業問題）

提供企業最佳決策
The Process of
decision-making
Identify objectives
Define the problem
Identify possible solutions
Select the best possible
solution
Implement the decision
 Theory of the firm
A theory indicating how a firm
behaves and what its goals are

Value of the firm

The present value of the firm’s
expected future cash flows
 Present value of
expected future profits
(TRt - TCt)
n

(1+i)t
t=1

where: TRt = the firm’s TR in year t

TCt = the firm’s TC in year t
i = the interest rate
and t goes from 1 (next year) to n (the
last year in the planning horizon)
Principal-agent problem

Occurs when owners can only

imperfectly monitor the
behavior of employees
 Market demand curve
Shows the amount of a commodity that
buyers would like to purchase at various
prices
Price

Demand
Quantity
 Market supply curve

Shows the amount of a commodity that

sellers would offer at various prices
Price
Supply

Quantity
Market equilibrium price
A price that can be maintained
Price Supply

Demand

Quantity
Demand shifts: left

Price
Supply

Demand

Quantity
Demand shifts: right
Price
Supply

Demand

Quantity
Supply shifts: right

Price
Supply

Demand

Quantity
 Supply shifts: left

Price
Supply

Demand

Quantity
See you Next Week
Be Happy!!