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Explain Managerial economics is economics applied in decision making?
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∙ 13y ago
Explain Managerial economics is economics applied in decision making?
Wiki User
∙ 13y ago
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How does managerial economics bridge the gap between theory and business practices?
"Business economics integrates economic theory with business practice" Business economics is a special branch of economics that bridges gap between abstract theory and business practice. It deals with use of economic concepts and principles for decision making in a business unit. Hence, it is also called as Managerial Economics or Economics of the firm. Managerial economics is economics applied in the business decision making. Hence, it is also called Applied Economics. In simple words, business economics is the discipline which helps a business manager in decision making for achieving the desired results. In other words, it deals with the application of economic theory to business management.
Managerial Economics serves as a link between traditional economics and decision making Discuss?
many concepts in economics are regarded as empirically observed and evident but not theoretically understood or validated. That is to say there is a void between the academic Economics (traditional) and the practical application of Economics (managerial). Managerial economics serves as a means of applying economic theory to managerial decisions (real life business problems) of dealing with limited resources and competing ends. Managerial economics is a link as it's basis is in "traditional" economics but it can rarely be perfectly applied to contemporary "real life" decision making.
define managerial economics?
Managerial economics is an applied field of economics that focuses on the use of economic analysis and techniques to solve business decisions. It combines economic theory with managerial practice and focuses on the microeconomic aspects of an organization, such as demand analysis and pricing, production costs, and investment decisions. Managerial economics applies microeconomic analysis to specific decisions in order to optimize outcomes and maximize profits. It also considers the macroeconomic environment in which a business operates, such as global economic trends and government regulations. Managerial economics provides a framework for understanding how businesses interact with their environment and make decisions that will impact their long-term success.
State of the Economy in 1998?
INTRODUCTION TO MANAGERIAL ECONOMICS The word economics is derived from a Greek term "OCIO NOMOS" which means house management it explains how different individuals behave while managing their economics activities. Economics teaches us how a person tries to satisfy his unlimited desires with the limited resources at his disposal. In other word it teaches us how to use the available scares resources to meet our unlimited desires. Hear the question of choice comes in the need for choice arises in the context of "Scarcity". MANAGERAL ECONOMICS: Economics is concerned with determining the means of achieving given objectives in the most efficient manner. While managerial economics is the application of economic theory and private institutions. It is an extraction from economic theory, particularly micro economics those concepts and techniques which enable the decision. Makers to efficiently allocate the resources of the firm. If also enables the decision makers to understand the economic environment and the effect of changes in this on resources allocation within the organization Definition: Economics is deals with money or money oriented activities. According to M N Nair's and Meram "Managerial economics consist of the use of economic modes of thought to analyses business situations" According to Haynes "Managerial economics is economics applied in decision making". Nature & Scope of Managerial Economics:- The nature of economics can be known through its relation with micro and macro economics normative and descriptive economics, the theory of decision making operations research and static's. It is said that a successful business economist will try to integrate the concepts and methods from all the disciplines. The main focus in managerial economics is to find an optimal solution to a given managerial problem. The problem may relate to production, reduction or control of costs determination of price of a given product or service make or buy decision inventory decision. Capital management investment decision or human resource management. The economist is concerned with analysis of the economy as a whole where as the managerial economist is essentially concerned with making decision in the context of a single firm. The main areas of managerial economics Þ Demand analysis Þ Cost analysis Þ Production Þ Pricing decisions Þ Profit management Þ Capital management
How managerial economics is link with other academic disciplines?
1. Relationship with economics:The relationship between managerial economics and economics theory may be viewed form the point of view of the two approaches to the subject Viz. Micro Economics and Marco Economics. Microeconomics is the study of the economic behavior of individuals, firms and other such micro organizations. Managerial economics is rooted in Micro Economic theory. Managerial Economics makes use to several Micro Economic concepts such as marginal cost, marginal revenue, elasticity of demand as well as price theory and theories of market structure to name only a few. Macro theory on the other hand is the study of the economy as a whole. It deals with the analysis of national income, the level of employment, general price level, consumption and investment in the economy and even matters related to international trade, Money, public finance, etc.The relationship between managerial economics and economics theory is like that of engineering science to physics or of medicine to biology. Managerial economics has an applied bias and its wider scope lies in applying economic theory to solve real life problems of enterprises. Both managerial economics and economics deal with problems of scarcity and resource allocation.2. Management theory and accounting:Managerial economics has been influenced by the developments in management theory and accounting techniques. Accounting refers to the recording of pecuniary transactions of the firm in certain books. A proper knowledge of accounting techniques is very essential for the success of the firm because profit maximization is the major objective of the firm.Managerial Economics requires a proper knowledge of cost and revenue information and their classification. A student of managerial economics should be familiar with the generation, interpretation and use of accounting data. The focus of accounting within the firm is fast changing from the concepts of store keeping to that if managerial decision making, this has resulted in a new specialized area of study called "Managerial Accounting".3. Managerial Economics and mathematics:The use of mathematics is significant for managerial economics in view of its profit maximization goal long with optional use of resources. The major problem of the firm is how to minimize cost, hoe to maximize profit or how to optimize sales. Mathematical concepts and techniques are widely used in economic logic to solve these problems. Also mathematical methods help to estimate and predict the economic factors for decision making and forward planning.Mathematical symbols are more convenient to handle and understand various concepts like incremental cost, elasticity of demand etc., Geometry, Algebra and calculus are the major branches of mathematics which are of use in managerial economics. The main concepts of mathematics like logarithms, and exponentials, vectors and determinants, input-output models etc., are widely used. Besides these usual tools, more advanced techniques designed in the recent years viz. linear programming, inventory models and game theory fine wide application in managerial economics.4. Managerial Economics and Statistics:Managerial Economics needs the tools of statistics in more than one way. A successful businessman must correctly estimate the demand for his product. He should be able to analyses the impact of variations in tastes. Fashion and changes in income on demand only then he can adjust his output. Statistical methods provide and sure base for decision-making. Thus statistical tools are used in collecting data and analyzing them to help in the decision making process.Statistical tools like the theory of probability and forecasting techniques help the firm to predict the future course of events. Managerial Economics also make use of correlation and multiple regressions in related variables like price and demand to estimate the extent of dependence of one variable on the other. The theory of probability is very useful in problems involving uncertainty.5. Managerial Economics and Operations Research:Taking effectives decisions is the major concern of both managerial economics and operations research. The development of techniques and concepts such as linear programming, inventory models and game theory is due to the development of this new subject of operations research in the postwar years. Operations research is concerned with the complex problems arising out of the management of men, machines, materials and money.Operation research provides a scientific model of the system and it helps managerial economists in the field of product development, material management, and inventory control, quality control, marketing and demand analysis. The varied tools of operations Research are helpful to managerial economists in decision-making.6. Managerial Economics and the theory of Decision- making:The Theory of decision-making is a new field of knowledge grown in the second half of this century. Most of the economic theories explain a single goal for the consumer i.e., Profit maximization for the firm. But the theory of decision-making is developed to explain multiplicity of goals and lot of uncertainty.As such this new branch of knowledge is useful to business firms, which have to take quick decision in the case of multiple goals. Viewed this way the theory of decision making is more practical and application oriented than the economic theories.7. Managerial Economics and Computer Science:Computers have changes the way of the world functions and economic or business activity is no exception. Computers are used in data and accounts maintenance, inventory and stock controls and supply and demand predictions. What used to take days and months is done in a few minutes or hours by the computers. In fact computerization of business activities on a large scale has reduced the workload of managerial personnel. In most countries a basic knowledge of computer science, is a compulsory programme for managerial trainees.To conclude, managerial economics, which is an offshoot traditional economics, has gained strength to be a separate branch of knowledge. It strength lies in its ability to integrate ideas from various specialized subjects to gain a proper perspective for decision-making.A successful managerial economist must be a mathematician, a statistician and an economist. He must be also able to combine philosophic methods with historical methods to get the right perspective only then; he will be good at predictions. In short managerial practices with the help of other allied sciences.
How does managerial economics bridge the gap between theory and business practices?
"Business economics integrates economic theory with business practice" Business economics is a special branch of economics that bridges gap between abstract theory and business practice. It deals with use of economic concepts and principles for decision making in a business unit. Hence, it is also called as Managerial Economics or Economics of the firm. Managerial economics is economics applied in the business decision making. Hence, it is also called Applied Economics. In simple words, business economics is the discipline which helps a business manager in decision making for achieving the desired results. In other words, it deals with the application of economic theory to business management.
Managerial Economics serves as a link between traditional economics and decision making Discuss?
many concepts in economics are regarded as empirically observed and evident but not theoretically understood or validated. That is to say there is a void between the academic Economics (traditional) and the practical application of Economics (managerial). Managerial economics serves as a means of applying economic theory to managerial decisions (real life business problems) of dealing with limited resources and competing ends. Managerial economics is a link as it's basis is in "traditional" economics but it can rarely be perfectly applied to contemporary "real life" decision making.
What is marginal economics explain?
the application of economic science in business decision making is all pervasive.more specifically, economic laws and tools of economic analysis are now applied a great deal in the process of business decision making. this has led,asmentioned earlier, to the emergence of a separate branch of study colled managerial economics.
define managerial economics?
Managerial economics is an applied field of economics that focuses on the use of economic analysis and techniques to solve business decisions. It combines economic theory with managerial practice and focuses on the microeconomic aspects of an organization, such as demand analysis and pricing, production costs, and investment decisions. Managerial economics applies microeconomic analysis to specific decisions in order to optimize outcomes and maximize profits. It also considers the macroeconomic environment in which a business operates, such as global economic trends and government regulations. Managerial economics provides a framework for understanding how businesses interact with their environment and make decisions that will impact their long-term success.
State of the Economy in 1998?
INTRODUCTION TO MANAGERIAL ECONOMICS The word economics is derived from a Greek term "OCIO NOMOS" which means house management it explains how different individuals behave while managing their economics activities. Economics teaches us how a person tries to satisfy his unlimited desires with the limited resources at his disposal. In other word it teaches us how to use the available scares resources to meet our unlimited desires. Hear the question of choice comes in the need for choice arises in the context of "Scarcity". MANAGERAL ECONOMICS: Economics is concerned with determining the means of achieving given objectives in the most efficient manner. While managerial economics is the application of economic theory and private institutions. It is an extraction from economic theory, particularly micro economics those concepts and techniques which enable the decision. Makers to efficiently allocate the resources of the firm. If also enables the decision makers to understand the economic environment and the effect of changes in this on resources allocation within the organization Definition: Economics is deals with money or money oriented activities. According to M N Nair's and Meram "Managerial economics consist of the use of economic modes of thought to analyses business situations" According to Haynes "Managerial economics is economics applied in decision making". Nature & Scope of Managerial Economics:- The nature of economics can be known through its relation with micro and macro economics normative and descriptive economics, the theory of decision making operations research and static's. It is said that a successful business economist will try to integrate the concepts and methods from all the disciplines. The main focus in managerial economics is to find an optimal solution to a given managerial problem. The problem may relate to production, reduction or control of costs determination of price of a given product or service make or buy decision inventory decision. Capital management investment decision or human resource management. The economist is concerned with analysis of the economy as a whole where as the managerial economist is essentially concerned with making decision in the context of a single firm. The main areas of managerial economics Þ Demand analysis Þ Cost analysis Þ Production Þ Pricing decisions Þ Profit management Þ Capital management
Scope of managerial research in research methodology?
Managerial economics may be viewed as economics applied to problem solving at the levels of the firm. The problem relates to choices and allocation of resources, which are basically economic in nature and are faced by managers all the time. Managerial research is also known as operations research. It was undertaken for the first time in Second World War in America. It is also interdisciplinary research done by mathematicians, tacticians, Engineers and other Scientists. The operation researchers developed concepts of linear programming, inventory models and game theory. They attempted to attain optimization. The framework of optimization has been used a great deal in managerial economics. The operation research has influenced managerial economics through its new concepts and models for dealing risk and uncertainly. Managerial economics it primarily an aid to analyse and decision making in the context of the firm. But in the management more than decision making, the implementation, control and conflict resolutions are also covered. Managerial research is concerned with decision making at the managerial level it considers the alternative theories of firm behaviour, decision making problems and different approaches to arrive at the most appropriate answers to such problems. It draws heavily from Microeconomics, Econometrics and operation research. The decision making area is related to the production decisions, the exchange decisions and consumption decisions. The case study method is useful in managerial research. It helps us to look for and organised the data and evidence relevant to the problem at hand. A manager does not get all data he needs well organised and presented to him on a platter. The cases may bring out the complexity of the environment in which managers have to take decisions.
How managerial economics is link with other academic disciplines?
1. Relationship with economics:The relationship between managerial economics and economics theory may be viewed form the point of view of the two approaches to the subject Viz. Micro Economics and Marco Economics. Microeconomics is the study of the economic behavior of individuals, firms and other such micro organizations. Managerial economics is rooted in Micro Economic theory. Managerial Economics makes use to several Micro Economic concepts such as marginal cost, marginal revenue, elasticity of demand as well as price theory and theories of market structure to name only a few. Macro theory on the other hand is the study of the economy as a whole. It deals with the analysis of national income, the level of employment, general price level, consumption and investment in the economy and even matters related to international trade, Money, public finance, etc.The relationship between managerial economics and economics theory is like that of engineering science to physics or of medicine to biology. Managerial economics has an applied bias and its wider scope lies in applying economic theory to solve real life problems of enterprises. Both managerial economics and economics deal with problems of scarcity and resource allocation.2. Management theory and accounting:Managerial economics has been influenced by the developments in management theory and accounting techniques. Accounting refers to the recording of pecuniary transactions of the firm in certain books. A proper knowledge of accounting techniques is very essential for the success of the firm because profit maximization is the major objective of the firm.Managerial Economics requires a proper knowledge of cost and revenue information and their classification. A student of managerial economics should be familiar with the generation, interpretation and use of accounting data. The focus of accounting within the firm is fast changing from the concepts of store keeping to that if managerial decision making, this has resulted in a new specialized area of study called "Managerial Accounting".3. Managerial Economics and mathematics:The use of mathematics is significant for managerial economics in view of its profit maximization goal long with optional use of resources. The major problem of the firm is how to minimize cost, hoe to maximize profit or how to optimize sales. Mathematical concepts and techniques are widely used in economic logic to solve these problems. Also mathematical methods help to estimate and predict the economic factors for decision making and forward planning.Mathematical symbols are more convenient to handle and understand various concepts like incremental cost, elasticity of demand etc., Geometry, Algebra and calculus are the major branches of mathematics which are of use in managerial economics. The main concepts of mathematics like logarithms, and exponentials, vectors and determinants, input-output models etc., are widely used. Besides these usual tools, more advanced techniques designed in the recent years viz. linear programming, inventory models and game theory fine wide application in managerial economics.4. Managerial Economics and Statistics:Managerial Economics needs the tools of statistics in more than one way. A successful businessman must correctly estimate the demand for his product. He should be able to analyses the impact of variations in tastes. Fashion and changes in income on demand only then he can adjust his output. Statistical methods provide and sure base for decision-making. Thus statistical tools are used in collecting data and analyzing them to help in the decision making process.Statistical tools like the theory of probability and forecasting techniques help the firm to predict the future course of events. Managerial Economics also make use of correlation and multiple regressions in related variables like price and demand to estimate the extent of dependence of one variable on the other. The theory of probability is very useful in problems involving uncertainty.5. Managerial Economics and Operations Research:Taking effectives decisions is the major concern of both managerial economics and operations research. The development of techniques and concepts such as linear programming, inventory models and game theory is due to the development of this new subject of operations research in the postwar years. Operations research is concerned with the complex problems arising out of the management of men, machines, materials and money.Operation research provides a scientific model of the system and it helps managerial economists in the field of product development, material management, and inventory control, quality control, marketing and demand analysis. The varied tools of operations Research are helpful to managerial economists in decision-making.6. Managerial Economics and the theory of Decision- making:The Theory of decision-making is a new field of knowledge grown in the second half of this century. Most of the economic theories explain a single goal for the consumer i.e., Profit maximization for the firm. But the theory of decision-making is developed to explain multiplicity of goals and lot of uncertainty.As such this new branch of knowledge is useful to business firms, which have to take quick decision in the case of multiple goals. Viewed this way the theory of decision making is more practical and application oriented than the economic theories.7. Managerial Economics and Computer Science:Computers have changes the way of the world functions and economic or business activity is no exception. Computers are used in data and accounts maintenance, inventory and stock controls and supply and demand predictions. What used to take days and months is done in a few minutes or hours by the computers. In fact computerization of business activities on a large scale has reduced the workload of managerial personnel. In most countries a basic knowledge of computer science, is a compulsory programme for managerial trainees.To conclude, managerial economics, which is an offshoot traditional economics, has gained strength to be a separate branch of knowledge. It strength lies in its ability to integrate ideas from various specialized subjects to gain a proper perspective for decision-making.A successful managerial economist must be a mathematician, a statistician and an economist. He must be also able to combine philosophic methods with historical methods to get the right perspective only then; he will be good at predictions. In short managerial practices with the help of other allied sciences.
Why is the define research objectives stage of the research process probably the most important?
ukinam antonete
When was Applied Economics Research Centre created?
Applied Economics Research Centre was created in 1973.
What is the difference between descriptive economics and applied economics?
there is no difference between them. In both cources , you have to study the same things. applied economics includes some more study than general economics.
What are the classifications of economics?
classification of economics 1-Applied economics 2-Theoretical economics i)Welfare economics ii)Positive economics(i-Micro economics,ii-Macro economics,iii-Mathematical economics)
Classification of economics?
classification of economics 1-Applied economics 2-Theoretical economics i)Welfare economics ii)Positive economics(i-Micro economics,ii-Macro economics,iii-Mathematical economics)
