New features include:

• NEW! Learning Objectives. Each chapter begins with clearly identified learning objectives, designed to enhance the learning experience and help implement the AACSB mandate to demonstrate student learning.
• NEW! End-of-Chapter Material. Over 20% more end-of-chapter material was added to the Sixth Edition. New problems and applications are included at the end of each chapter set so that existing problem numbers match those in the Fifth Edition, making for an easy transition.
• NEW! Enhanced Time Warner Case. Includes a revised introduction and conclusion to the case study, as well as nine new end-of-case problems (called Memos). New detailed teaching notes and solutions to Memos were created for instructors. The case allows students to see the practical utility of managerial economics in shaping business strategy.
• NEW! Expanded Student OLC. Now includes data for the Time Warner Case Memos, data needed for various end-of-chapter problems, spreadsheet versions of key tables, and spreadsheet macros that students can use to find the optimum price and quantity under a variety of market settings. Plus, the website includes 10 additional full-length cases described below, chapter quizzes, PowerPoint files, and key term review.
• NEW! Updated test bank with 100% revised and 10% new problems.
• NEW! Fully updated text data and boxed examples.

Key features include:

• Focus on Business Strategy. Baye not only provides the Economic Foundations of Business Strategy, but also includes Advanced Topics in Business Strategy. Chapter 13, Advanced Topics in Business Strategy, covers such topics as the economics of networks, predatory pricing, new product pricing, limit pricing, and foreclosure. This chapter better prepares students by covering today's issues facing managers.
• Teaching Notes for Additional Cases. 10 additional full-length cases were prepared by Michael Baye and Patrick Scholten, complete with teaching notes with links to chapter content.
• Full Coverage of the Economics of Information. Managers seldom have full information to guide their decisions. Chapter 12 equips managers with the tools needed to make decisions in environments of imperfect or asymmetric information. Material shows students how screening, signaling, self-selection devices, and incentive mechanisms can be used to mitigate problems caused by asymmetric information (such as moral hazard and adverse selection). The material on auctions also explains the optimal bidding strategies in auctions with both independent private values and affiliated (or correlated) value estimates. Auctions are important for managers to understand, as often firms participate either as the auctioneer or as a bidder.
• Links to Other Business Disciplines. The text illustrates important links between managerial economics and other business disciplines. These links include Porter's Five Forces Model, pricing rules, advertising, and other concepts emphasized in courses in Corporate Strategy, Marketing, Managerial Accounting, and Management. These links allow the students to see how microeconomics and game theory are used to shape business strategy.
• Time Warner Case. A Case Study in Business Strategy — Challenges at Time Warner — follows Chapter 14 and was prepared by Kyle Anderson, Michael Baye, and Dong Chen especially for this text. It can be used either as a capstone case for the course or to supplement individual chapters. The case allows students to apply core elements from managerial economics to a rich business environment. Instructors can use the case as the basis for an “open ended” discussion of business strategy, or assign specific “memos” (contained at the end of the case) that require students to apply specific tools from managerial economics to the case.
• Headlines begin each chapter with a real-world economic problem. These problems motivate students to better understand the chapter material. By consulting the end of chapter answers (Answering the Headline), they learn basic economic thinking.
• Demonstration Problems are interspersed in each chapter with answers following the problem. Students enjoy the instant feedback gained from these problems and verification of material mastery.
• Inside Business boxes illustrate real-world applications of theory developed in the chapter; these are drawn from both current economic literature and the popular press.
• Calculus and Non-Calculus Alternatives. While Baye does not require calculus, the design allows the user to include some calculus-based material if desired. Following each algebraic principle or formula is a clearly marked calculus alternative; these are labeled in the text margins. The calculus alternatives state the preceding principle or formula in calculus notation and explain the relation between the two formulas. There are also four calculus-based chapter appendices. Professors have the option to use more sophisticated mathematics should the students have the proper background.