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What economic conditions are relevant in managerial decision making?
Wiki User
∙ 11y ago
There are seven economic conditions which are relevant in managerial decision making. The conditions are market structure, supply and demand condition, technology, government regulation, international dimensions, future conditions and macroeconomic factors.
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∙ 11y ago
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What are the roles and responsibilities of a managerial economist?
role of managerial economists in disicionmaking?Managerial economics (also called business economics), is a branch of economics that applies microeconomic analysis to specific business decisions. As such, it bridges economic theory and economics in practice. It draws heavily from quantitative techniques such as regression analysis and correlation, Lagrangian calculus (linear). If there is a unifying theme that runs through most of managerial economics it is the attempt to optimize business decisions given the firm's objectives and given constraints imposed by scarcity, for example through the use of operations research and programmingregardspraveen raomail:raojain@gmial.comWhen an economist needs a price, interest rate or otherquantity to use in an analysis, he will tend to look to theproduct and financial markets for an answer rather than"building it up" from accounting costs.Economists are trained to think in terms of marginal changeEconomists are generally well-versed in mathematics andstatistics and tend to approach problems using those tools.Economists also are comfortable with probabilities and willbuild models incorporating them. We are trained in doingsimulation studies.When an economist needs a price, interest rate or other quantity to use in an analysis, he will tend to look to the product and financial markets for an answer rather than "building it up" from accounting costs.Economists are trained to think in terms of marginal changeEconomists are generally well-versed in mathematics and statistics and tend to approach problems using those tools.Economists also are comfortable with probabilities and will build models incorporating them. We are trained in doing simulation studies.While atmosphere of business uncertainty creates complications in the processof decision making, economic principles help in minimizing theseuncertainity.economist can help by analyzing these economic principles.RisksUncertainty exists in every business and managerial economist can help reduce riskthrough uncertainty model analysis and decision-theory analysis. Heavy use of statistical probability theory helps provide potential scenarios for businesses to usewhen making decisionResponsibilities of managerial economistMeasuring the increase in earning capacity of firma managerial economist hasgreat responsibility to achieve an objective of earning maximum profit. If he does not dothis properly the capacity of firm cannot achieve its objects. therefore, the managerialeconomist should continue his efforts in increasing the capacity of his firm.Successful forecasting successof a business firm is largely determined by thedegree of accuracy and correctness of forecast made by analyst by analyzing allinternal and external factors and by accessing their impact on profitability and workingof firm. He must try to minimize the uncertainties of future .if he finds an error in hisforecast, he should alert the management at earliest , so the necessary changes maybe made in plans, policies and programming.Contacting the source of economic information and experts amanagerialeconomist is responsible for providing all the relevant economic information to themanagement so the plans of the organization be chalked out after taking intoconsideration. So he should maintain the contact with all possible sources from wherehe can collect the information relevant for firm.For this purpose, he should joinprofessional associations and take active part in them. In fact, one of the best means of determining the caliber of a managerial economist is to evaluate his ability to obtaininformation quickly by personal contacts rather than by lengthy research from either readily available or obscure reference sources.Achieving respectful status in firmhemust be able to earn full status on the businessteam. He should be ready and even offer himself to take up special assignments, bethat in study teams, committees or special projects. For, a managerial economist canonly function effectively in an atmosphere where his success or failure can be traced notonly to his basic ability, training and experience, but also to his personality and capacityto win continuing support for himself and his professional ideas.while intellectually hemust be in tune with industry's thinking the wider national perspective should not beabsents from his advice to top managemenWhile atmosphere of business uncertainty creates complications in the processof decision making, economic principles help in minimizing theseuncertainity.economist can help by analyzing these economic principles.RisksUncertainty exists in every business and managerial economist can help reduce riskthrough uncertainty model analysis and decision-theory analysis. Heavy use of statistical probability theory helps provide potential scenarios for businesses to usewhen making decisionResponsibilities of managerial economistMeasuring the increase in earning capacity of firma managerial economist hasgreat responsibility to achieve an objective of earning maximum profit. If he does not dothis properly the capacity of firm cannot achieve its objects. therefore, the managerialeconomist should continue his efforts in increasing the capacity of his firm.Successful forecasting successof a business firm is largely determined by thedegree of accuracy and correctness of forecast made by analyst by analyzing allinternal and external factors and by accessing their impact on profitability and workingof firm. He must try to minimize the uncertainties of future .if he finds an error in hisforecast, he should alert the management at earliest , so the necessary changes maybe made in plans, policies and programming.Contacting the source of economic information and experts amanagerialeconomist is responsible for providing all the relevant economic information to themanagement so the plans of the organization be chalked out after taking intoconsideration. So he should maintain the contact with all possible sources from wherehe can collect the information relevant for firm.For this purpose, he should joinprofessional associations and take active part in them. In fact, one of the best means of determining the caliber of a managerial economist is to evaluate his ability to obtaininformation quickly by personal contacts rather than by lengthy research from either readily available or obscure reference sources.Achieving respectful status in firmhemust be able to earn full status on the businessteam. He should be ready and even offer himself to take up special assignments, bethat in study teams, committees or special projects. For, a managerial economist canonly function effectively in an atmosphere where his success or failure can be traced notonly to his basic ability, training and experience, but also to his personality and capacityto win continuing support for himself and his professional ideas.while intellectually hemust be in tune with industry's thinking the wider national perspective should not beabsents from his advice to top managemenA managerial economist helps the management by using his analytical skills and, In order to perform all these roles, a managerial economist has to conduct.A managerial economist helps the management by using his analytical skills and highly developed techniques in solving complex issues of successful.
Is capitalism compatible with social justice?
cost benefit analysis maybe regarded as the systematic thinking about relevant decision making is this approach not relevant to making decisions about the things valued very highly or that have infinite value such as life or health?
Relevance of opportunity cost?
Opportunity cost is the economic, or real cost, of taking any action (as opposed to its accounting, or fiscal, cost). This cost is relevant as part of profit-optimising functions that determine allocations of spending and goods for economic agents.
What do critics say about command economies?
Critics commonly argue that because planned economies cannot effectively process as much relevant information as a market does, command economic systems cannot coordinate economic activity or satisfy consumer demand as well as market forces do.
What is another name for the mixed economy?
A mixed economy is an economy that includes a variety of private and government control, or a mixture of capitalism and socialism. Relevant aspects include: a degree of private economic freedom (including privately owned industry) intermingled with centralized economic planning and government regulation. I have not been able to find another definitive name for a a mixed economy.
Two common areas of accounting that respectively provide information to internal and external users are?
Internal users with information are managerial accounting is to provide relevant and timely information for managers' and employees' decision-making needs. (private accounting) External users of accounting information include customers, creditors, and the government. These users are not directly involved in managing and operating the business are call financial accounting. Their job is to provide relevant and timely information for decision-making needs of users outside of the business. 1. managerial accounting and financial accounting
What costs are relevant in the decision to shut down the Clayton facility?
Which Costs Are Relevant In The Decision To Shut Down The Clayton Facility
Are sunk costs ever relevant for decision-making purposes?
NO, its cost which was wasted in past we can not recover it so it is not relevant for decision making.
What is the distinction between relevant cost and irrelevant cost?
Relevant cost is that cost which is necessary for the underlying decision in decision making process while irrelevant cost is not necessary to be decision to be made.
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.
Fraud and ethics in managerial accounting?
A managerial accountant is a person who controls the financial information for a company. Ethics require that managerial accountants keep company financial records completely confidential, and they should objectively inform their clients of all relevant financial information.
Information that is not relevant to the decision at hand is called incomplete?
no
What is the difference between relevant cost and irrelevant cost?
Relevant cost is that cost which is required for the specific decision making process or the cost which will be change due to specific decision while irrelevant cost has no concern with decision making or any specific decision.
All future costs are relevant in decision making?
Future costs are relevant in decision making if the decision will affect their amounts. For example, suppose you're trying to decide whether to drive to work or take the bus. Relevant future costs information includes (1) the cost of gasoline and tolls needed to drive to and from work and (2) the cost of bus fare because both of these costs depend on your decision. However, future costs that won't change - such next month's rent on your apartment - are not relevant because, regardless of your decision, they will not change. Note that past costs are never relevant in decision making.
Why is decision making relevant to planning?
When planning, there are different options that could be chosen. Decision making is relevant to planning because decisions as to the best options need to be made.
Are all future cost are relevant in decision making?
Future costs are relevant in decision making if the decision will affect their amounts. For example, suppose you're trying to decide whether to drive to work or take the bus. Relevant future costs information includes (1) the cost of gasoline and tolls needed to drive to and from work and (2) the cost of bus fare because both of these costs depend on your decision. However, future costs that won't change - such next month's rent on your apartment - are not relevant because, regardless of your decision, they will not change. Note that past costs are never relevant in decision making.
What does MCI stamped in inside band of a ring also stamped 14k mean?
It stands for Monetary Conditions Index. I know very little on the subject, but it is relevant with the economic worth of the ring.
