9781118041581

xviii Contents

• CHAPTER 1 Introduction to Economic Decision Making
  
  
  • SECTION I: Decisions within Firms
  
  
  
  


• CHAPTER 2 Optimal Decisions Using Marginal Analysis


• CHAPTER 3 Demand Analysis and Optimal Pricing


• CHAPTER 4 Estimating and Forecasting Demand


• CHAPTER 5 Production


• CHAPTER 6 Cost Analysis
  
  
  • SECTION II: Competing within Markets
  
  
  
  


• CHAPTER 7 Perfect Competition


• CHAPTER 8 Monopoly


• CHAPTER 9 Oligopoly


• CHAPTER 10 Game Theory and Competitive Strategy
  
  
  • Analysis CHAPTER 11 Regulation, Public Goods, and Benefit-Cost
  
  
  
  


• CHAPTER 1 Introduction to Economic Decision Making
  
  
  • SEVEN EXAMPLES OF MANAGERIAL DECISIONS
  
  
  • SIX STEPS TO DECISION MAKING
    
    
    • Step 1: Define the Problem
    
    
    • Step 2: Determine the Objective
    
    
    • Step 3: Explore the Alternatives
    
    
    • Step 4: Predict the Consequences
    
    
    • Step 5: Make a Choice
    
    
    • Step 6: Perform Sensitivity Analysis
    
    
    
    
  
  
  • PRIVATE AND PUBLIC DECISIONS: AN ECONOMIC VIEW
    
    
    • Public Decisions
    
    
    
    
  
  
  • THINGS TO COME
    
    
    • The Aim of This Book
    
    
    
    
  
  
  • SECTION I: Decisions within Firms
  
  
  
  


• CHAPTER 2 Optimal Decisions Using Marginal Analysis
  
  
  • SITTING A SHOPPING MALL
  
  
  • A SIMPLE MODEL OF THE FIRM
    
    
    • A Microchip Manufacturer
    
    
    
    
  
  
  • MARGINAL ANALYSIS
    
    
    • Marginal Analysis and Calculus
    
    
    
    
  
  
  • MARGINAL REVENUE AND MARGINAL COST
    
    
    • Marginal Revenue
    
    
    • Marginal Cost
    
    
    • Profit Maximization Revisited
    
    
    
    
  
  
  • SENSITIVITY ANALYSIS
    
    
    • Asking What if
    
    
    • AND OPTIMIZATION TECHNIQUES APPENDIX TO CHAPTER 2: CALCULUS
    
    
    • OPTIMIZATION USING SPREADSHEETS SPECIAL APPENDIX TO CHAPTER 2:
    
    
    
    
  
  
  
  


• CHAPTER 3 Demand Analysis and Optimal Pricing
  
  
  • DETERMINANTS OF DEMAND
    
    
    • The Demand Function
    
    
    • The Demand Curve and Shifting Demand
    
    
    • General Determinants of Demand
    
    
    
    
  
  
  • ELASTICITY OF DEMAND
    
    
    • Price Elasticity
    
    
    • Other Elasticities
    
    
    • Price Elasticity and Prediction
    
    
    
    
  
  
  • DEMAND ANALYSIS AND OPTIMAL PRICING
    
    
    • Price Elasticity, Revenue, and Marginal Revenue
    
    
    • Maximizing Revenue
    
    
    • Optimal Markup Pricing
    
    
    • Price Discrimination
    
    
    • Information Goods
    
    
    • PREFERENCES AND DEMAND APPENDIX TO CHAPTER 3: CONSUMER
    
    
    
    
  
  
  
  


• CHAPTER 4 Estimating and Forecasting Demand
  
  
  • COLLECTING DATA
    
    
    • Consumer Surveys
    
    
    • Controlled Market Studies
    
    
    • Uncontrolled Market Data
    
    
    
    
  
  
  • REGRESSION ANALYSIS
    
    
    • Ordinary Least-Squares Regression
    
    
    • Interpreting Regression Statistics
    
    
    • Potential Problems in Regression
    
    
    
    
  
  
  • FORECASTING
    
    
    • Time-Series Models
    
    
    • Fitting a Simple Trend
    
    
    • Barometric Models
    
    
    • Forecasting Performance
    
    
    • Final Thoughts
    
    
    • USING SPREADSHEETS APPENDIX TO CHAPTER 4: REGRESSION
    
    
    • STATISTICAL TABLES SPECIAL APPENDIX TO CHAPTER 4:
    
    
    
    
  
  
  
  


• CHAPTER 5 Production
  
  
  • BASIC PRODUCTION CONCEPTS
  
  
  • PRODUCTION WITH ONE VARIABLE INPUT
    
    
    • Short-Run and Long-Run Production
    
    
    • Optimal Use of an Input
    
    
    
    
  
  
  • PRODUCTION IN THE LONG RUN Contents xvii
    
    
    • Returns to Scale
    
    
    • Least-Cost Production
    
    
    
    
  
  
  • MEASURING PRODUCTION FUNCTIONS
    
    
    • Linear Production
    
    
    • Production with Fixed Proportions
    
    
    • Polynomial Functions
    
    
    • The Cobb-Douglas Function
    
    
    • Estimating Production Functions
    
    
    
    
  
  
  • OTHER PRODUCTION DECISIONS
    
    
    • Multiple Plants
    
    
    • Multiple Products
    
    
    
    
  
  
  
  


• CHAPTER 6 Cost Analysis
  
  
  • RELEVANT COSTS
    
    
    • Opportunity Costs and Economic Profits
    
    
    • Fixed and Sunk Costs
      
      
      • Ordering a Best Seller Profit Maximization with Limited Capacity:
      
      
      
      
    
    
    
    
  
  
  • THE COST OF PRODUCTION
    
    
    • Short-Run Costs
    
    
    • Long-Run Costs
    
    
    
    
  
  
  • RETURNS TO SCALE AND SCOPE
    
    
    • Returns to Scale
    
    
    • Economies of Scope
    
    
    
    
  
  
  • COST ANALYSIS AND OPTIMAL DECISIONS
    
    
    • A Single Product
    
    
    • The Shut-Down Rule
    
    
    • Multiple Products
    
    
    
    
  
  
  • APPENDIX TO CHAPTER 6: TRANSFER PRICING
    
    
    • SHORT-RUN AND LONG-RUN COSTS SPECIAL APPENDIX TO CHAPTER 6:
    
    
    
    
  
  
  • SECTION II: Competing within Markets
  
  
  
  


• CHAPTER 7 Perfect Competition
  
  
  • THE BASICS OF SUPPLY AND DEMAND
    
    
    • Shifts in Demand and Supply
    
    
    
    
  
  
  • COMPETITIVE EQUILIBRIUM
    
    
    • Decisions of the Competitive Firm
    
    
    • Market Equilibrium
    
    
    
    
  
  
  • MARKET EFFICIENCY
    
    
    • Private Markets: Benefits and Costs
    
    
    
    
  
  
  • INTERNATIONAL TRADE
    
    
    • Tariffs and Quotas
    
    
    
    
  
  
  
  


• CHAPTER 8 Monopoly
  
  
  • PURE MONOPOLY
    
    
    • Barriers to Entry
    
    
    
    
  
  
  • PERFECT COMPETITION VERSUS PURE MONOPOLY
    
    
    • Cartels
    
    
    • Natural Monopolies
    
    
    
    
  
  
  • MONOPOLISTIC COMPETITION
  
  
  
  


• CHAPTER 9 Oligopoly
  
  
  • OLIGOPOLY
    
    
    • Five-Forces Framework
    
    
    • Industry Concentration
    
    
    • Concentration and Prices
    
    
    
    
  
  
  • QUANTITY COMPETITION
    
    
    • A Dominant Firm
    
    
    • Competition among Symmetric Firms
    
    
    
    
  
  
  • PRICE COMPETITION
    
    
    • Price Rigidity and Kinked Demand
    
    
    • Price Wars and the Prisoner’s Dilemma
    
    
    
    
  
  
  • OTHER DIMENSIONS OF COMPETITION
    
    
    • Strategic Commitments
    
    
    • Advertising
    
    
    
    
  
  
  • TYING AND BUNDLING APPENDIX TO CHAPTER 9:
  
  
  
  


• CHAPTER 10 Game Theory and Competitive Strategy
  
  
  • SIZING UP COMPETITIVE SITUATIONS
  
  
  • ANALYZING PAYOFF TABLES
    
    
    • Equilibrium Strategies
    
    
    
    
  
  
  • COMPETITIVE STRATEGY
    
    
    • Market Entry
    
    
    • Bargaining
    
    
    • Sequential Competition
    
    
    • Repeated Competition
    
    
    
    
  
  
  • APPENDIX TO CHAPTER 10: MIXED STRATEGIES
  
  
  • Analysis CHAPTER 11 Regulation, Public Goods, and Benefit-Cost
  
  
  • I. MARKET FAILURES AND REGULATION
  
  
  • MARKET FAILURE DUE TO MONOPOLY
    
    
    • Government Responses