THE UNIVERSITY OF MANCHESTER
MANCHESTERBUSINESSSCHOOL WORLDWIDE
DEGREE EXAMINATIONS June 2010
MASTER OF BUSINESS ADMINISTRATION
COURSE – MANAGERIAL ECONOMICS
TIME ALLOWED: 3 HOURS plus 10 Minutes Reading Time*
NOTE TO INVIGILATORS
THIS IS AN OPEN BOOK EXAMINATION
*During the 10 minute reading time you may write on this paper but not on the answer book.
Instructions to students
1. Answer Any Three questions. All questions carry equal marks. Use case study materials where appropriate.
2.Marks will be deducted for answers of an illegible nature.
3.Do not staple any foreign materials into the answer books.
4.Please ensure that you write your 4 digit exam I.D number and paper reference number on the front of your answer book. Failure to do so may result in non-marking of your script.
5.Ensure that your answer is well structured. State and defend any assumptions clearly. The examiner is looking for a robustly defended answer.
1. Either (a) “Maximising market share rather than shareholder value may be a critical decision for management, but the right one in the long run”. Do you agree or disagree with this statement? Be specific in your reply.
Or (b) Illustrate the key features of the Marris managerial model. Examine whether the model suggests guidelines and principles for management intent on maximising growth in the company
2.Do modern firms avoid price wars? Please explain and support your answer with case study material.
3. Either (a) "The ability of managers to pursue goals other than profit maximisation is severely limited by internal and external constraints; the profit maximisation model provides the best explanation of firms' behaviour." Critically evaluate this statement.
Or (b) ‘The make-or-buy decision involves a calculated balancing of several benefits and costs of integration within a firm’s supply chain’ Critically assess this statement by drawing upon your knowledge of transaction cost economics (TCE).
4. How important is it for management to achieve cost leadership in the product market? Examine the extent to which the production-cost relationship, for example, can help management achieve cost leadership.
5. Either (a) “Modern management are opting for strategic alliances as a method of entry into product markets”. Critically examine this statement and offer an explanation for the trend. How can you rationalise the trend towards alliances?
Or (b) The thesis that structure follows strategy (Chandler’s dilemma) has been applied to different firms that compete in different scenarios. Examine the extent to which modern game theory can assist management in understanding the implications of such a thesis for the firm’s strategy.
6.Either (a) Select your Workshop case assignment, and using your research and analysis of that case proceed to critically examine the importance of type, technology and time to strategic decision making in the company identified in your case.
Or (b) Outline the game foundations of strategic concepts such as value net, PARTS and GEMS and then critically examine the extent to which they add to the economics of strategyas applied tofirm-specific analysis.
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