Delivered at:: Department of Economics

Course type:: Elective course

When:: 2 year, 4 module

Instructors

Artemova, Diana

Telekhov, Ignaty I.

Full Syllabus

Abstract

The purpose of Economic of the Firm course is to acquaintance students majoring in economics and management with the way modern business practices are organized. It covers the topics of firm types, their lifecycle and associations as well as the structure of financial statements and information it can provide for managers. The core topics of the course focus on policies to rise firm efficiency and on the way fixed and current assets are used to create a stream of profits and cash flows.

Learning Objectives

The course aims to form a holistic view on different aspects of functioning of firms in the modern economy, develop skills in using tools to analyze efficiency of enterprises. Practical classes are based on solving problems and conducting complex economic calculations, which help to understand the specifics and provide basic tools for the work of an economist and a financial manager in a firm. Classes aim to form the habits of practical economic thinking and the ability to see opportunities for optimizing the activities of an enterprise, assess the level of economic efficiency, as well as determine the choice of an economically feasible strategy and tactics of firms.

Expected Learning Outcomes

Be able to understand the notion of a firm;
Be able to istinguish between different legal forms of organizations
Be able to name different classifications of organizations
Be able to choose between different legal forms of organizations depending on goals, financial needs, desired level of liability and ease of selling the share of the business or attracting new owners
Be able to know three types of statements of each firm: the balance sheet, the income statement, and the cash flow statement, and information they can provide
Must know and understand relationships between different types of fixed (non-current) assets and their role in business operations
Must know and understand relationships between different types of depreciation and amortization policy’s, their distinctive features and ways to calculate them
Must know and understand relationships between indicators and ratios that show efficiency with which fixed assets are used and ways to improve it
Be able to know and understand relationships between different types of current assets and their role in business operations
Be able to judge how efficiently the firm uses its assets using the concept of working capital and turnover rations
Be able determination of the need for working capital
Be able propose measures to improve efficiency of different parts of working capital
Be able to know and understand relationships between different types of costs
Be able to analyze cost structure of a firm
Be able to apply the main methods of cost calculation and distribution of indirect costs (basic cost allocation, direct-costing, activity-based costing)
Be able to apply break-even analysis and name its strengths and weaknesses
Be able to know and understand different types of firm income measurements
Be able to calculate profitability ratios and apply them to rise firms efficiency
Be able to apply Strategic Profit Model in firm analysis and decision-making
Be able to read and interpret business press articles with analytics concerning specific firms
Must know and understand relationships between different types of business associations
Must know and understand relationships between can name reasons why business associations are formed an what problems they can solve
Must know and understand relationships between what are mergers and acquisitions and how to fight hostile takeover
Must understand factors that drive the life cycle of the company, know main problems that arise at different stages of the life cycle and how to cope with them

Course Contents

1. Introduction to the economics of the firm
2. Fixed (non-current) assets
3. Current assets and working capital
4. Cost structure
5. Income and profit
6. Business associations
7. Firm life cycle

Assessment Elements

Work in Class
Test
Exam

Interim Assessment

2022/2023 4th module
0.25 * Work in Class + 0.25 * Test + 0.5 * Exam

Bibliography

Recommended Core Bibliography

Fundamentals of corporate finance, Brealey, R. A., 1995
Fundamentals of corporate finance, Brealey, R. A., 2018
Management accounting for decision makers, Atrill, P., 2009
Management accounting for decision makers, Atrill, P., 2012
Management and cost accounting, Drury, C., 2012
Management and cost accounting, Drury, C., 2015

Recommended Additional Bibliography

Розанова, Н. М. Экономика фирмы в 2 ч. Часть 1. Фирма как основной субъект экономики : учебник для вузов / Н. М. Розанова. — Москва : Издательство Юрайт, 2023. — 187 с. — (Высшее образование). — ISBN 978-5-534-01742-7. — Текст : электронный // Образовательная платформа Юрайт [сайт]. — URL: https://urait.ru/bcode/511745 (дата обращения: 28.08.2023).
Розанова, Н. М. Экономика фирмы в 2 ч. Часть 2. Производственный процесс : учебник для вузов / Н. М. Розанова. — Москва : Издательство Юрайт, 2023. — 265 с. — (Высшее образование). — ISBN 978-5-534-02104-2. — Текст : электронный // Образовательная платформа Юрайт [сайт]. — URL: https://urait.ru/bcode/513066 (дата обращения: 28.08.2023).
Экономика организации : учебник и практикум для среднего профессионального образования / А. В. Колышкин [и др.] ; под редакцией А. В. Колышкина, С. А. Смирнова. — Москва : Издательство Юрайт, 2023. — 498 с. — (Профессиональное образование). — ISBN 978-5-534-06278-6. — Текст : электронный // Образовательная платформа Юрайт [сайт]. — URL: https://urait.ru/bcode/516314 (дата обращения: 28.08.2023).

Bachelor’s Programme 'Economics'

Study Office

Economics of the Firm