Chartered Managerial Economist® (Ch.ME©)
Specialist Designation in Managerial Economics [Course Outline]
In order to effectively manage and operate a business, managers and leaders need to understand the market characteristics and economic environment they operate in. Some people equate economics with money; others think that it is about government taxes and spending.
Economics, essentially, is about the production of goods and services in an economy. This has to be done in such a manner that minimum real resources are used for getting the maximum benefit.
A close interrelationship between management and economics had led to the development of managerial economics. Economic analysis is required for various concepts such as demand, profit, cost, and competition. In this way, managerial economics is considered as economics applied to “problems of choice’’ or alternatives and allocation of scarce resources by the firms.
Managerial economics is a discipline that combines economic theory with managerial practice. It helps in covering the gap between the problems of logic and the problems of policy. The subject offers powerful tools and techniques for managerial policy making.
After all an enterprise, a firm or a company is an economic unit that produces goods and services (and not money!). We can survive without money but not without goods and services. Managerial Economics is about understanding the principles and practices of economics, such as pricing and production decisions. It is about the policies that managers adopt. It is about how the principles of economics that help guide a manager in her decision making process.
However, contrary to the traditional micro-economic theory, in managerial economics the emphasis is not just on micro-level aspect like demand, supply, markets, price, cost of production, isoquants, indifference curves, etc.; but a clever amalgam of micro and macro aspect of economics.
This is necessary because managers have to place their own enterprises in the larger context of the economy, so as to understand the differing business condition that may prevail in the economy, such as inflation and business cycles.
Economic Overview
India has emerged as the fastest growing major economy in the world and is expected to be one of the top three economic powers of the world over the next 10-15 years, backed by its strong democracy and partnerships.
India’s GDP is estimated to have increased 6.6 per cent in 2017-18 and is expected to grow 7.3 per cent in 2018-19. In April-July quarter of 2018-19, the GDP grew by 8.2 per cent.
India has retained its position as the third largest startup base in the world with over 4,750 technology startups, with about 1,400 new start-ups being founded in 2016, according to a report by NASSCOM.
India’s labour force is expected to touch 160-170 million by 2020, based on rate of population growth, increased labour force participation, and higher education enrolment, among other factors, according to a study by ASSOCHAM and Thought Arbitrage Research Institute.
India’s gross domestic product (GDP) is expected to reach US$ 6 trillion by FY27 and achieve upper-middle income status on the back of digitisation, globalisation, favourable demographics, and reforms.
India’s revenue receipts are estimated to touch Rs 28-30 trillion (US$ 385-412 billion) by 2019, owing to Government of India’s measures to strengthen infrastructure and reforms like demonetisation and Goods and Services Tax (GST).
India is also focusing on renewable sources to generate energy. It is planning to achieve 40 per cent of its energy from non-fossil sources by 2030 which is currently 30 per cent and also have plans to increase its renewable energy capacity from to 175 GW by 2022.
Program Objectives
The certification program of Chartered Managerial Economist from AAFM has an emphasis on managerial decision-making. Obviously while managers have to undertake many decisions like financial and marketing decisions, ‘economic decision’ is paramount.
This Program is constructed to help candidate understand the economic background to, and the implications of, business decisions and to look at practical applications of economics in business and management.
This Program on Managerial Economics brings together economics and business decision-making so that in practice the best solutions to solving business and management problems can be found and applied. It blends together traditional macroeconomic theory with microeconomic theory, and examines and shows how business and managerial economics can influence each other.
Economic theory and policy are introduced in the context of the environment in which firms operate, but avoid excessive concentration on theoretical economic models, and instead it emphasizes the link between economics and business management, how economists view the way the economy works, the state of the economy, and business economics topics – all in a clear and non-technical way.
The Program covers costs, prices, industries and markets – and more – and economic subjects which too often are overlooked by business leaders and business people.
Learning Outcomes of the Program
After completing the certification course, a candidate shall be able to:
- Know about the basic concepts of economics like utility, opportunity cost, marginal concept and time value of money.
- Know about laws of demand and supply.
- Gain the skill of measuring elasticity.
- Evaluate the different theories of consumer behavior.
- Understand various market forms like perfect competition and monopoly.
- Analyze the theory of cost and production.
- Comprehend pricing policies and practices.
- Know about macro-economic concepts like national income, inflation and unemployment.
- Understand general equilibrium, IS-LM, modified LM and Aggregate Demand.
- Evaluate different business cycle theories.
- Understand change management, stress management, organization culture and climate and apply the same to be able to manage change, reduce stress, transform organizations, and in real life organizations.
Role of a Managerial Economist
What do Managerial Economists do?
A managerial economist can play a very important role by assisting the management in using the increasingly specialized skills and sophisticated techniques, required to solve the difficult problems of successful decision-making and forward planning. In business concerns, the importance of the managerial economist is therefore recognized a lot today.
In advanced countries like the USA, large companies employ one or more economists. In our country too, big industrial houses have understood the need for managerial economists. Such business firms like the TATAs, DCM and Hindustan Lever employ economists. A managerial economist can contribute to decision-making in business in specific terms.
- Managerial Economist studies the economic patterns at macro-level and analysis it’s significance to the specific firm he is working in.
- Managerial Economist has to consistently examine the probabilities of transforming an ever-changing economic environment into profitable business avenues.
- Managerial Economist assists the business planning process of a firm.
- Managerial Economist also carries cost-benefit analysis.
- Managerial Economist assists the management in the decisions pertaining to internal functioning of a firm such as changes in price, investment plans, type of goods /services to be produced, inputs to be used, techniques of production to be employed, expansion/ contraction of firm, allocation of capital, location of new plants, quantity of output to be produced, replacement of plant equipment, sales forecasting, inventory forecasting, etc.
- In addition, a Managerial Economist has to analyze changes in macro- economic indicators such as national income, population, business cycles, and their possible effect on the firm’s functioning.
- Managerial Economist is also involved in advising the management on public relations, foreign exchange, and trade. He guides the firm on the likely impact of changes in monetary and fiscal policy on the firm’s functioning.
- Managerial Economist also makes an economic analysis of the firms in competition. He has to collect economic data and examine all crucial information about the environment in which the firm operates.
- The most significant function of a Managerial Economist is to conduct a detailed research on industrial market.
- In order to perform all these roles, a Managerial Economist has to conduct an elaborate statistical analysis.
- Managerial Economist also provides management with economic information such as tax rates, competitor’s price and product, etc. They give their valuable advice to government authorities as well.
Managerial Economists should:
Besides this, a Managerial Economist has various functions in an organization, which are as follows:
- Forecasting sales of an organization
- Performing individual market research
- Performing economic analysis of rival organizations
- Analyzing the pricing policy of the industry; thereby formulating the pricing policy of the organization
- Performing investment analysis
- Assisting the top management in making decisions related to trade and public relations and foreign exchange
- Performing capital budgeting and production planning
- Measuring the earning capacity of an organization
- Keeping the top management informed regarding any changes in the business environment.
Benefits of Program
If you intend to learn managerial economics, then be aware that AAFM, with its highly commendable managerial economics certification course can help you out. AAFM has been in the certification industry for a long time already so you have an assurance that its managerial economics course can provide you with the most accurate and updated information about this branch of economics.
With the kind of managerial economics training provided by AAFM, you will no longer find it hard to understand how managerial economics work, how business practices and economics concepts and aspects are amalgamated, different theories and principles used in managerial economics, how you can use managerial economics to formulate the most informed business decisions and the different analytical and statistical methods and tools that you can use in assessing economic theories so you can easily solve practical business problems. Earning a managerial economics certificate from AAFM is a huge help in informing the whole industry that you are competent and skillful enough in successfully and efficiently implementing this branch of economics.
Key Benefits of the Program
The course will give you better insight into the working of the economic sector of the country.
- Introduce some economics principles and applications that are crucial to managerial decision making
- Enhance critical thinking ability by considering the aspects of cost and benefit
- Develop a sound analytical and logical approach
- Develop an understanding of how different market structures work and how a company’s strategic decisions could depend on the particular market structure in which it operates
- Discuss and analyze a wide range of stylized business situations and real-world problems
- Develop some of the skills in demand for a successful career in business strategy
- Design sound policy using principles of behavioral economics
Why you should attend the program
Having this certification program, a candidate will be able to:
- Identify sources of economic value
- Create new market opportunities through differentiation and alternative approaches
- Understand the mechanisms of competition and their business implications
- Anticipate future market trends and dynamics, including in terms of competition policy
- Engineer futures that are more congruent with their interests
- Develop a long-term, consistent strategy and vision, beyond mere day-to-day tactics
- How markets work; supply, demand and market equilibrium
- Elasticity of supply and demand, taxes and subsidies
- Production of goods and services, measures of productivity
- Making decisions for hiring and spending on infrastructure
- Opportunity costs, different cost concepts, planning for the future
- Pricing and selling decisions with different types of competitive pressures
- Problems with markets and what we can do about it
Program Ideal For:
This program is designed for professionals who work in the economic and finance industry, especially those with a background in finance and economics.
The programme is designed for a wide range of professional skill sets, including:
- Actuarists
- Corporate Financiers
- Credit and Risk Analysts
- Economists & Managers / Directors
- Financial Analysts
- Heads of Department
- Individuals Involved in Economic Policy Formations Analysts
- Investment Bankers
- Research Analysts
- Wealth & Fund Managers
Educational Requirements
Minimum Qualification required to pursue the program:
- For Graduates (Any Stream): Pass Level 1 – Chartered Economist Exam.
- For Post Graduates and above in Economics: Directly pursue the “Chartered Managerial Economist” Designation.
Career Opportunities
When it comes to answering big questions about the economy, businesses know there’s no one better for the job than economics professionals. The far-reaching impact of the field means that you’ll have your choice of positions in virtually any industry. Typically, AAFM’s “Chartered Managerial Economist” certification students begin their careers within their concentration area, but the degree’s flexibility also allows you to branch out to other specialties.
Specific positions you can pursue include:
- Actuary
- Asset Management Researcher.
- Budget Analyst
- Cash Management Specialist
- Commercial Credit Analyst
- Corporate Finance Associate
- Credit Analyst
- Environmental Economist
- Insurance Underwriter
- Investment Analyst
- Investment Banking Associate
- Investor Relations Associate
- Management Consultant
- Market Research Analyst
- Operations Research Analyst
- Personal Financial Advisor
- Pricing Analyst
- Statistician
Important skills required for Managerial Economist
Key Skills and Proficiencies of a Managerial Economist
- Analytical Skills: Economists must be able to review data, observe patterns, and draw logical conclusions. For example, some economists analyze historical employment trends to make future projections on jobs.
- Communication Skills: Economists must be able to explain their work to others. They may give presentations, explain reports, or advise clients on economic issues. They may collaborate with colleagues and sometimes must explain economic concepts to those without a background in economics.
- Critical-thinking Skills: Economists must be able to use logic and reasoning to solve complex problems. For instance, they might identify how economic trends may affect an organization.
- Detail Oriented: Economists must pay attention to details. Precise data analysis is necessary to ensure accuracy in their findings.
- Math Skills: Economists use the principles of statistics, calculus, and other advanced topics in mathematics in their economic analyses.
- Writing Skills: Economists must be able to present their findings clearly. Many economists prepare reports for colleagues or clients; others write for publication in journals or for news media.
- Knowledge of Social Sciences: Mathematics is not all you need to be a successful economist. Economics also has a lot of common ground with other social science subjects like psychology, history, and sociology.
- Curious: In order to be successful as a Managerial Economist, need to have a strong sense of curiosity.
- Independent Thinker: While it’s obviously important to have knowledge of other people’s work and theories, to be truly successful as an economist you also need to have insights and ideas of your own.
- Comfort with Uncertainty: You will need to be comfortable with uncertainty, as not every question in this field has a clear and unambiguous answer.
- Open Minded: For success in any academic field, you need to be open-minded. It’s important that you are open to new ideas and do not become too set in your perspective.
- Self-driven: Something else that’s important for Managerial Economist, including economists, is the ability to motivate oneself.
Salary Prospect of Managerial Economist
Managerial economics certification holders can also expect to earn higher in this industry. The presence of your managerial economics certification makes it easier for you to work as a managerial economics specialist which allows you to receive around $56,000 to $82,000 per year. Your certification is also extremely useful in your attempt to grab the position of a managerial economics consultant and earn as much as $121,000 annually.
The median annual wages for economists in the top industries in which they work are as follows:
| Sector | Salary |
|---|---|
| Finance and Insurance | $110,580 |
| Government (excluding Postal Services) | $106,850 |
| Management and Scientific Technical Consulting Services | $94,630 |
| Scientific Research and Development Services | $91,570 |
| State Government | $63,880 |
Curriculum of Chartered Industrial Economist
The curriculum of Chartered Managerial Economist consists of in-depth study of economics, which is based on the core concepts of the managerial economics; market; firm; and the firm in national and global setting. Investigate & explore the moral and individual dimensions of managerial economics and ethical viewpoint of economy, industry and understand the moral responsibilities as a Chartered Managerial Economist.
Economics & Management
For a professional like a Chartered Managerial Economist; an understanding of concepts of economics and firm is of prime importance. This part of course content would enable the Chartered Managerial Economist to get a basic understanding of why some countries are rich and others are dirt poor. This part of course would also cover the power of market; market failure and government failure along with the organization and performance of the firm.
The part of course would enable the Economics professionals in acquainting with the fundamental of Porter’s five forces strategy; resource based model and restricted entry when the firm reacts in short-run and long-run. The objective of this part is to enable a Chartered Managerial Economist to understand the game theory; prisoner’s dilemma; repeated game and sequential game strategy.
Entrepreneur and the Strategy to Government
For a professional like a Chartered Managerial Economist; an understanding of the market process and dynamics of market is the crucial aspect of the study. This part of course content would enable the Chartered Managerial Economist to get a better understanding about the entrepreneurial strategy and the rent seeker entrepreneur. This part of course would also cover the economic profit of the entrepreneur.
The part of course would enable the Economics professionals in acquainting with the fundamentals of government interventions in business. The objective of this part is to enable a Chartered Managerial Economist to understand the rent seeking; anti-trust; dumping; international regulations; trade & tariffs; economic regulations; and the social regulations and maximizing the power of firm as well as stakeholders and shareholders.
Demand and Revenue Management
For a Chartered Managerial Economist; know-how of the demand, supply, and price and consumer choice of the economic sector is the crucial aspect of the study. This part of course would enable the Chartered Managerial Economist to get a better understanding about the elasticity of demand; output & productivity; cost of production; operating leverage and sunk cost. This part of course would also cover the golden rule; graphics; simple mathematics of profit maximization; and marginal revenue and sales maximization.
The part of course would enable the Economics professionals in pricing; personalized pricing; peak-load pricing; cost-plus pricing; framing, bundling, tying and cannibalization. The objective of this part is to enable a Chartered Managerial Economist to understand the knowledge economy which revolves around the supply chain decomposition; intellectual property rights and the knowledge business. It also enables Economist to assess the increasing returns and market vs. authority with knowledge workers
Corporate Form and the Cost of Capital
For a Chartered Managerial Economist; know-how of the economic profit and the capital market is the crucial aspect of the study. This part of course would enable the Chartered Managerial Economist to get a better understanding about the stocks; bonds; capital structure; and CAPM. This part of course would also cover the internal use of capital and the corporate form and the debtholders & Equityholders.
The part of course would enable the Economics professionals in transfer price and assets allocation in the firm. The objective of this part is to enable a Chartered Managerial Economist to understand the importance of prediction market; using markets to collect dispersed information and internal market failure. It also enables Economist to understand the market based management and measuring the economic profit.
Firm in National and Global Setting
For a Chartered Managerial Economist; understanding of the national setting and the US Economic policy is the crucial aspect of the study. This part of course would enable the Chartered Managerial Economist to get a better understanding about the Keynesian vs. Free market. This part of course would also cover the foreign exchange; exchange rate regime; exchange rate exposure; the global capital market and the Asian Crisis.
The part of course would enable the Economics professionals to understand that a firm has to grow to be successful and become global. The objective of this part is to enable a Chartered Managerial Economist to understand and form strategy to diversify the risk and create a market for corporate control or to form strategy to create a corporate controlled market for firm.
Government on the Market Economy
For a Chartered Managerial Economist it is crucial to understand the positive and negative externalities and the managerial application of public goods. This part of course would enable to get a better understanding about the managerial application of political economy and optimal allocation of social resources. This part of course would also cover the managerial application of free trade and their reforms and the price controls.
Regulations
For a Chartered Managerial Economist it is crucial to understand the regulations in managerial economics. This part of course would enable to get a better understanding about the conduct regulation; structural regulation; and congestion regulation. This part of course would also cover the economic regulations followed and practiced through the world.
Apart from the above mentioned course content, AAFM suggest candidate/students to go beyond the course and study the following topics for better understandings of the certification course. These topics are:
- Micro-economics
- Macro-economics
- Industrial Economics
- Introduction to Mathematical Economics
- Econometrics
Fee for Chartered Industrial Economist
| Head | Resident Student | Overseas Student |
|---|---|---|
| Registration Fees$ | Rs.29,000 + GST | USD1000 |
| Registration Renewal | Rs.10,000 + GST | USD100 |
| Examination Fee–Chartered Economist®% | Rs.3,000 + GST | USD100 |
| Examination Fee–Chartered Health Economist® | Rs.10,000 + GST | USD100 |
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