1. Welcome to EC 209: Managerial Economics- Group A By: Dr
Welcome to EC 209: Managerial Economics- Group A By: Dr. Jacqueline Khorassani
Study Guide
Week Seven
(Note: You must go over these slides and complete every
task outlined here before Thursday, October 18)

2. Don’t forget that Aplia Assignment 4 Is due on Wednesday before 5 PM.
Don’t miss it.

3. Long Run Production Function
Isoquant
What is it?
Shape?
Reasons for different shapes?
What is the marginal rate of technical substitution
Why does it diminish?

4. Cost in long run
Isocost
What is it?
Shape/slope?
Reasons?

5. Cost minimization
Rule?
Graph?
Optimal input substitution?

6. Cost function in the short run
What are the different types of costs?
Graphs?

7. Cubic Cost Function
What is it?

8. Long Run Costs
Economies/diseconomies of scale
Sources?
Graph?

9. Multi-Product Cost Function
What are they?
What is the economies of scope?
What is cost complementarily?
What is the Quadratic Multi-Product Cost Function?

10. You will now need to study
Papers by Jensen and Gibbons
Available on Blackboard;
Chapter 6 of Baye

11. What is manager’s role in an organization?
Describe the 3 methods of procuring Inputs.
What are transaction costs?
What are specialized Investments?
Types?
Implications?
What is Williamson’s Analysis?
What are the factors influencing the relative efficiency of market and firms?

12. What is a one-shot transaction?
What is an ongoing supply relationship?
What is the Principal-Agent Problem?
Internal/external incentives
What is the indifference curve approach to managerial incentives?
How can the problem between managers and workers be solved?
What are the managerial incentive schemes?

13. Chapter 7 of Baye What is market structure?
What are the major structure variables?
What is the Four-Firm Concentration Ratio?
What is the Herfindahl-Hirschman Index (HHI)?
What are the limitations of concentration measures?
What is the Rothschild Index?
What is the Lerner Index?
What is the markup factor?
What is the Dansby-Willig Performance Index

14. Integration and Merger Activity
What is Vertical Integration?
What is Horizontal Integration?
What is Conglomerate Mergers?