Preface

This is work in progress and it will develop during the semester so please check for updates regularly.
I appreciate you reading it, and I appreciate any comments, but please do not share this document or quote it without asking me.
This script aims to support my lecture at the HS Fresenius. It is incomplete and no substitute for taking actively part in class.
Do not distribute without permission.
The lecture notes are available online or you can download it as a pdf file here

About the author

Prof. Dr. Stephan Huber¹

I am a Professor of International Economics and Data Science at HS Fresenius, holding a Diploma in Economics from the University of Regensburg and a Doctoral Degree (summa cum laude) from the University of Trier. I completed postgraduate studies at the Interdisciplinary Graduate Center of Excellence at the Institute for Labor Law and Industrial Relations in the European Union (IAAEU) in Trier. Prior to my current position, I worked as a research assistant to Prof. Dr. Dr. h.c. Joachim Möller at the University of Regensburg, a post-doc at the Leibniz Institute for East and Southeast European Studies (IOS) in Regensburg, and a freelancer at Charles University in Prague.

Throughout my career, I have also worked as a lecturer at various institutions, including the TU Munich, the University of Regensburg, Saarland University, and the Universities of Applied Sciences in Frankfurt and Augsburg. Additionally, I have had the opportunity to teach abroad for the University of Cordoba in Spain and the University of Perugia. My published work can be found in international journals such as the Canadian Journal of Economics and the Stata Journal. For more information on my work, please visit my private homepage at https://hubchev.github.io.

Contact

   Hochschule Fresenius für Wirtschaft & Medien GmbH
   Im MediaPark 4c
   50670 Cologne
   
   Office: 4b OG-1 Bü01 (Office hour: Thursday 1-2 p.m.)
   Telefon: +49 221 973199-523
   Mail: stephan.huber@hs-fresenius.de
   Private homepage: www.t1p.de/stephanhuber
   Github: https://hubchev.github.io/

About this course

Workload: 125 h = 42 h (in-class) + 21 h (guided private study hours) - 62 h (private self-study).

Assessment Students complete this module with a written exam of 90 minutes. A passing grade in this module is achieved when the overall grade is greater than or equal to 4.0.

Learning outcomes: After successful completion of the module, students are able to:

describe how tools of standard price theory, location theory, production theory, and the theory of investment decision can be employed to formulate a decision problem,
evaluate alternative courses of action and choose among alternatives,
apply economic concepts and techniques in evaluating strategic business decisions taken by firms,
apply the knowledge of the mechanics of supply and demand to explain the functioning of markets.

How to prepare for the exam: I am convinced that reading the lecture notes, preparing for class, taking actively part in class, and trying to solve the exercises without going straight to the solutions is the best method for students to

maximize leisure time and minimize the time needed to prepare for the exam, respectively,
getting long-term benefits out of the course,
improve grades, and
have more fun during lecture hours.

Literature: Bazerman & Moore (2012), Hoover & Giarratani (2020), Parkin et al. (2017), Wilkinson (2022), Bonanno (2017)

Content:

Price theory

the market price of an efficient competitive market and sources of inefficiency
the impact of supply and demand on the market price
the output and price decision of a profit maximizing monopolist
regional market power and price setting

Production and cost theory

output and costs of firms in the short and long run
optimization under constraints (Lagrangian multiplier)
cost–volume–profit analysis

Location theory

Hotelling’s location model
Thünen’s model of agricultural land use
location fundamentals and agglomeration forces (sharing, matching, learning)

Strategic behaviour of firms

nature, scope, and elements of game theory
static games (Nash, Cournot, and Bertrand equilibrium)
limitations

Investment decisions

net present value
internal rate of return
decision-making under risk
decision-making under uncertainty
common pitfalls in investment decisions

About how to learn (and prepare for the exam)

Richard P. Feynman’s badge photo from Los Alamos National Laboratory²

Richard P. Feynman:

“I don’t know what’s the matter with people: they don’t learn by understanding; they learn by some other way by rote, or something. Their knowledge is so fragile!”

Stephan Huber:

“I agree with Feynman: The key to learning is understanding. However, I believe that there is no understanding without practice, that is, solving problems and exercises by yourself with a pencil and a blank sheet of paper without knowing the solution in advance.”

Study the lecture notes, i.e., try to understand the exercises and solve them yourself.
Study the exercises, i.e., try to understand the logical rules and solve the problems yourself.
Test yourself with past exams that you will find on ILIAS. The structure of the exam is more or less the same every semester.
If you have the opportunity to form a group of students to study and prepare for the exam, make use of it. It is great to help each other, and it is very motivating to see that everyone has problems sometimes.
If you have difficulties with some exercises and the solutions shown do not solve your problem, ask a classmate or contact me. I will do my best to help.

Picture is taken from https://sites.google.com/view/stephanhuber ↩︎
Picture is taken from https://repository.aip.org/islandora/object/nbla%3A299600 ↩︎

Managerial Economics