Business applications of elasticity

Business applications of elasticity

Bachelor of Business Studies (BBS) — First Year

Subject: Microeconomics for Business (MGT 207)

Unit 3: Elasticity of Demand and Supply

Academic Year: 2083/84

Topic Objectives

After studying this topic, students should be able to:

• Explain the scope and key elements of business applications of elasticity.
• Explain the economic reasoning and use appropriate diagrams or relationships in business analysis.

Curriculum Scope

• Uses of price, income, cross and advertisement elasticity

Detailed Microsyllabus

1. Pricing and demand planning

   1. Use price elasticity to evaluate pricing and revenue implications.
   2. Use income elasticity in market and demand forecasts.
   3. Use cross elasticity to assess related products.

2. Marketing decisions

   1. Advertisement elasticity and promotion allocation.
   2. Combine elasticity estimates with costs and business objectives.
   3. Recognize that estimated responses depend on context and data.

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Curriculum reference: Tribhuvan University, Faculty of Management, BBS curriculum with first-year syllabus, PDF pages 17-19.

Source note: The curriculum scope above is retained from the existing TU syllabus breakdown. The numbered study subtopics are editorial elaborations for teaching and study, rather than a separately issued TU syllabus. Unit lecture hours apply to the whole unit; no separate topic hours or marks are assigned here. The programme subject list identifies this course as MGT 207; the detailed subject heading in the source prints MGT 203.