This module provides an introduction to business economics, covering both microeconomic and macroeconomic aspects. It analyses how fundamental economic concepts affect individuals, companies, and financial institutions and systems. It illustrates how core economic principles may be used in a business environment to aid decision making and to guide behaviour.
Aims and Objectives
This module provides an introduction to business economics, covering both microeconomic and macroeconomic aspects.
Having successfully completed this module you will be able to:
- Describe the scope of economics and the various types of markets;
- Discuss the role of a firm’s growth strategy on its profitability and survival
- Analyse different pricing strategies that can be adopted by firms
- Describe the reasons for government intervention in the market and critically analyse the implications of this intervention for market efficiency and social equity
- List the main targets of competition policy and explain the extent to which it is effective
- Explain what is meant by globalisation and how it affects business;
- Analyse how specialisation and international trade can benefit countries and firms
- State and describe the key macroeconomic variables that governments seek to control;
- Describe and discuss the structure of the public sector finances of an industrialised economy
- Describe the various measures and components of national income
- Discuss the role of exchange rates in the economy and the various constituents of the balance of payments
- Identify the determinants of demand and supply in competitive markets
- Analyse how the determinants of money demand and money supply affect interest rates
- Describe and discuss the major factors affecting the rate of inflation, the level of interest rates, the exchange rate, the level of unemployment, and the rate of economic growth in the economy of an industrialised country
- Discuss how the government may use monetary policy and fiscal policy to manage a country’s economy
- Analyse the effectiveness of supply-side policies pursued by governments
- Discuss the interaction between supply and demand and the determination of equilibrium prices
- Define and calculate elasticities of supply and demand and explain the implications of varying elasticities for the workings of markets
- Describe and apply utility theory to economic and financial problems
- List and discuss the considerations of a firm with regards to its product selection as well as its marketing and advertising strategies
- Explain how profit maximising firms make short run and long run production choices
- Define different market structures and explain how the distinguishing features of each market structure affect the behaviour of individual firms and market equilibrium
- Analyse the interdependence of firms in imperfectly competitive markets and use game theory to characterise firms’ strategies
The following main topics will be covered in this module): 1. markets and firms: • economic concepts; • demand and supply; • elasticity and uncertainty; • consumer demand; • production and costs; • revenue and profit; 2. market structures and business strategy: • perfect competition and monopoly; • imperfect competition; • products, marketing, and advertising; • growth strategy; • pricing strategies; 3. government intervention and international trade: • government intervention in markets; • government and the firm; 4. globalisation and international trade: • globalisation and multinational business; • international trade; 5. macroeconomic theory, problems, and policies: • macroeconomic environment; • balance of payments and exchange rates; • money and interest rates; • business activity, unemployment, and inflation; • demand-side macroeconomic policies; • supply-side policies
Learning and Teaching
Teaching and learning methods
Lectures, tutorials, surgeries and private study suported by on-line reading/video material
|Total study time||150|
Resources & Reading list
D.K.H. Begg, S. Fischer, and R. Dornbusch (2005). Economics.
N.G. Mankiw and M.P. Taylor (2006). Economics.
J. Perloff (2008). Microeconomics -Theory and Applications with Calculus.
P. Krugman, R. Wells, and K. Graddy (2007). Economics.
R.G. Lipsey and K.A. Chrystal (2007). Economics.
N.G. Mankiw and M.P. Taylor (2007). Macroeconomics.
J. Sloman (2006). Essentials of Economics.
H. R. Varian (2006). Intermediate Microeconomics: A Modern Approach.
M. Parkin, M. Powell, and K. Matthews (2007). Economics.
The Faculty and Institute of Actuaries (2011). Subject CT7 Economics Core Reading.
J. Sloman (2006). Economics.
Jones, C.I. (2014). Macroeconomics.
J. Sloman, K. Hinde, and D. Garratt (2013). Economics for Business.
Repeat type: Internal & External
Costs associated with this module
Students are responsible for meeting the cost of essential textbooks, and of producing such essays, assignments, laboratory reports and dissertations as are required to fulfil the academic requirements for each programme of study.
In addition to this, students registered for this module typically also have to pay for:
Books and Stationery equipment
Course texts are provided by the library and there are no additional compulsory costs associated with the module.
Please also ensure you read the section on additional costs in the University’s Fees, Charges and Expenses Regulations in the University Calendar available at www.calendar.soton.ac.uk.