Includes index

Cover; Contents; Preface; About the Authors; Part 1: Introduction; Chapter 1: Introduction and Goals of the Firm; Chapter Preview; Managerial Challenge: How to Achieve Sustainability: Southern Company Electric Power Generation; 1-1 What Is Managerial Economics?; 1-2 The Decision-Making Model; 1-2a The Responsibilities of Management; What Went Right/What Went Wrong: Saturn Corporation; 1-2b Moral Hazard in Teams; 1-3 The Role of Profits; 1-3a Risk-Bearing Theory of Profit; 1-3b Temporary Disequilibrium Theory of Profit; 1-3c Monopoly Theory of Profit; 1-3d Innovation Theory of Profit. 1-3e Managerial Efficiency Theory of Profit1-4 Objective of the Firm; 1-4a The Shareholder Wealth-Maximization Model of the Firm; 1-5 Separation of Ownership and Control: The Principal-Agent Problem; 1-5a Divergent Objectives and Agency Conflict; 1-5b Agency Problem; 1-6 Implications of Shareholder Wealth Maximization; What Went Right/What Went Wrong: Eli Lilly Depressed by Loss of Prozac Patent; 1-6a Caveats to Maximizing Shareholder Value; 1-6b Residual Claimants; 1-6c Goals in the Public Sector and Not-for-Profit Enterprises; 1-6d Not-for-Profit Objectives. 1-6e The Efficiency Objective in Not-for-Profit OrganizationsSummary; Exercises; Case Exercise: Designing a Managerial Incentives Contract; Case Exercise: Shareholder Value of Renewable Energy from Wind Power at Hydro Co.: Is RE <C; Chapter 2: Fundamental Economic Concepts; Chapter Preview; Managerial Challenge: Why Charge 25 per Bag on Airline Flights?; 2-1 Demand and Supply: A Review; 2-1a The Diamond-Water Paradox and the Marginal Revolution; 2-1b Marginal Utility and Incremental Cost Simultaneously Determine Equilibrium Market Price; 2-1c Individual and Market Demand Curves. 2-1d The Demand Function2-1e Import-Export Traded Goods; International Perspectives: Exchange Rate Impacts on Demand: Cummins Engine Company; 2-1f Individual and Market Supply Curves; 2-1g Equilibrium Market Price of Gasoline; 2-2 Marginal Analysis; 2-2a Total, Marginal, and Average Relationships; 2-3 The Net Present Value Concept; 2-3a Determining the Net Present Value of an Investment; 2-3b Sources of Positive Net Present Value Projects; 2-3c Risk and the NPV Rule; 2-4 Meaning and Measurement of Risk; 2-4a Probability Distributions; 2-4b Expected Values. 2-4c Standard Deviation: An Absolute Measure of Risk2-4d Normal Probability Distribution; 2-4e Coefficient of Variation: A Relative Measure of Risk; What Went Right/What Went Wrong: Long-Term Capital Management (LTCM); 2-5 Risk and Required Return; Summary; Exercises; Case Exercise: Revenue Management at American Airlines; Part 2: Demand and Forecasting; Chapter 3: Demand Analysis; Chapter Preview; Managerial Challenge: Health Care Reform and Cigarette Taxes; 3-1 Demand Relationships; 3-1a The Demand Schedule Defined; 3-1b Constrained Utility Maximization and Consumer Behavior

eng.