Business Economics Notes Pdf

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  1. Sybcom Business Economics Notes Pdf

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Sybcom Business Economics Notes Pdf

Table for Lecture Notes
ses #TOPICSLecture noteshandouts
L1Markets
Introduction to the Course
Types of Markets: Competitive, Monopoly/Monopsony and Oligopoly/Oligopsony
The Boundaries of a Market
Product Boundaries, Geographical Boundaries
Examples: Bicycles, Prescription Drugs, Airline Travel, Role of Internet
Course Overview Markets (PDF)Extra Sources (PDF)
Questions for U.K. Credit Card Case Discussion (PDF)
L2Defining the Market
Discussion of Market Definition and Market Strategy
Case Study: Credit Cards in the U.K.
Market Definition (PDF)

Table: Profitability of Consumer Groups - Stuart, Harborne W., Jr. 'Pricing for Profit: The U.K. Credit Card Industry in the Late 1980s (A).' Boston, MA: Harvard Business School, 1997. Case No. 9-897-168.
Tips for Homework Solutions and Exams (PDF)
Exhibit 2: UK Credit Card System - Stuart, Harborne W., Jr. 'Pricing for Profit: The U.K. Credit Card Industry in the Late 1980s (A).' Boston, MA: Harvard Business School, 1997. Case No. 9-897-168.

L3Analysis of Competitive Markets
Supply-Demand Analysis of Government Intervention in Competitive Markets (Examples: Taxes, Subsidies, Tariffs, Import Quotas)
Detailed Analysis of the Sugar Quota and its Effects
Analysis of Competitive Markets (PDF)

Thurow, Roger and Geoff Winestock. A Global Journal Report --- Bittersweet: How an Addiction To Sugar Subsidies Hurts Development --Politically Vital Farm Support, Especially in EU, Throttles Exports From Poor Nations --- Negating $50 Billion in Aid.' The Wall Street Journal, 16 September 2002.
Sugar Surplus (
PDF)

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L4Production and Cost
Brief Review of Production Economics and Cost Minimization
Cost Concepts: Fixed, Variable and Sunk
Total, Average, and Marginal Cost in the Short Run and Long Run
Accounting Cost vs. Economic Cost
Production and Cost I (PDF)
L5Production and Cost (cont.)
Airline Cost Example: User Cost of Capital
Economies of Scale and Scope
The Learning Curve and Cost Reduction over Time
Production and Cost II (PDF)
L6Consumer Demand
Introduction to Consumer Demand: Empirical Demand Analysis and Models of Consumer Choice
Consumer Demand Introduction (PDF)
L7Consumer Demand (cont.)
Pricing, Product Characteristics and Quality
The Analysis of Network Externalities, and their Competitive and Strategic Implications
Example from the Software Industry
Consumer Demand and Product Characteristics (PDF)
L8Time and Uncertainty
Intertemporal Prices and Net Present Value
Uncertainty and Risk Aversion
Waiting and Option Value
Time and Uncertainty (PDF)
L9Market Power
Competition and Entry
Monopoly Power and Mark-up Pricing
Production across Multiple Plants
Pricing with Network Externalities
Market Power (PDF)
L10Pricing with Market Power
Various Forms of Price Discrimination
Segmented Markets and Pricing Oriented toward Market Segmentation
Examples of Price Discrimination in Practice
Pricing with Market Power I (PDF)Maremont, Mark. 'The Only Difference is When You Throw Them Away.' Business Week, 12 July 1993.
L11Pricing with Market Power (cont.)
The Use of Two-part Tariffs
Volume Pricing
Commodity Bundling
Pricing with Market Power IIGame Theory Cournot Questions (PDF)
Tran, Khanh T.L. 'Fans of Web Games Pay to Play.' The Wall Street Journal, 9 November 2000.
L12Game Theory and Competitive Strategy
Thinking Strategically
Duopoly Exercise (in class) to Introduce Cournot
First-mover Advantage: Stackelberg
Repeated Cournot
Cournot-Nash in detail
Nash Equilibrium in Other Kinds of Games
Game Theory and Competitive Strategy I (PDF)
L13Game Theory and Competitive Strategy (cont.)
Dominant Strategies
Nash Equilibrium again
Repeated Games
The Prisoners' Dilemma
Sequential Games
Threats and Credibility
Pre-emptive Moves
Entry Deterrence
Game Theory and Competitive Strategy II (PDF)Barnett, F. William. 'Making Game Theory Work in Practice.' The Wall Street Journal, 13 February 1995.
Myerson, Allen R. 'Philip Morris Cuts Cigarette Prices, Stunning Market -- Stocks Plunge as Result -- 40 cent-a-pack Reduction in No. 1 Marlboro Brand is Directed at Its Lower-Cost Rivals.' The New York Times, 3 April 1993.
Ortega, Bob. 'Retail Combat -- Warehouse-Club War Leaves Few Standing, And They Are Bruised -- Wal-Mart and Price-Costco Survive Bitter U.S. Clash, Will Resume it in Mexico -- An Intense Game of Chicken.' The Wall Street Journal, 18 November 1993.
L14Collusion and Competition in Oligopolistic Markets
Tacit Collusion
Examples: Electrical Equipment, Mineral Cartels
Collusion and Competition in Oligopolistic Markets (PDF)
L15Limiting Market Power
Antitrust Laws
U.S. vs. Microsoft®
Common Property Resources
Limiting Market Power (PDF)Antitrust and Monopolies (PDF)
Surowiecki, James. 'Mixed Motives.' The Financial Page, The New Yorker, 8 November 2004.
L16Auctions and Bidding
Alternative Forms of Auctions and their Characteristics
The Winner's Curse
Auctions and Bidding (PDF)Double Marginalization (PDF)
L17Transfer Pricing and Vertical Integration
Transfer Pricing in the Vertically Integrated Firm
Transfer Pricing with Outside Markets
Double Marginalization
Costs and Benefits of Vertical Integration
Transfer Pricing and Vertical Integration (PDF)Outsourcing Sales (PDF)
Phillips, Michael M. 'Taking Shelter -- As Congress Ponders New Tax Breaks, Firms Already Find Plenty -- Using Tactics Such as Shifting Profit to Havens Abroad, Some Pare Bills to Zero -- GM Keeps the Tab Down.' The Wall Street Journal, 9 August 1999.
L18Incentives and Information
Principal-agent Problem and Incentives
Moral Hazard
Multi-tasking
Promotion Tournaments and Up-or-out Policies
Team Incentives
Back-loaded Wages
Incentives and Employment (PDF)
L19Information and Market Structure
Markets with Asymmetric Information
Quality Uncertainty and the Market for 'Lemons'
Adverse Selection
Signaling
Asymmetric Information and Market Structure (PDF)
L20Externalities and Market Structure
Positive and Negative Externalities
Market Failure and Forms of Government Intervention
Property Rights
Externalities and Market Structure (PDF)Other Economics Courses (PDF)
L21Final Examination