What is managerial economics?
Managerial economics is defined as ‘consisting the use of economic mode of thought to analyze business situations. Managerial Economics had its beginning in the early part of 1950’s. It has progressively displaced the term business economics. It refers to the firm’s decision-making process.
Managerial economics is more of an “Applied economics” used in decision making. It bridges the gap between economics theory and managerial practices. It emphasizes the use of economic analysis in clarifying problems, in organizing and evaluation information and comparing alternative courses of action. It also provides application in managing non-profit organizations and public sector undertakings. To some Managerial economics is applied economics plus the application of economic theory and methodology to business administration practices. It uses the tools and techniques of economic analysis to solve business problems. It provides the link between traditional economics and the managerial decision making.
Making use of scarce resources effectively is nothing else but its same as building effective business strategy to cut competition and gain advantage over others. So managerial economics help business managers these days to apply the rules of economics practically to build the best competitive business strategy.
Knowledge of managerial economics help a manager to practically apply the concepts in the real world and fight the competition effectively. Managerial economics consists of many different topics like,
Introduction to Managerial Economics
Role of Managerial Economics in Decision Making
Opportunity cost Principle
Production Possibility Curve
Incremental Concept
Cardinal and Ordinal Approaches to Consumer Behaviour
Equi-Marginal Principle
Law of Diminishing Marginal Utility
Indifference Curve Analysis
Demand Analysis
Demand Function
Determinants of Demand
Elasticity of Demand
Demand Estimation and Forecasting
Production Function
Short Run and Long Run Production Analysis
Isoquants
Theory of Cost and Market Structures
Economies of Scale and Economies of Scope
Revenue curves
Price-Output decisions under Perfect Competition
Monopoly
Monopolistic Competition
Oligopoly
Strategic Behaviour of Firms
Game Theory
Nash Equilibrium
Prisoner’s Dilemma
Price and Non-price Competition
So it becomes necessary for today’s teachers to make the potential managers experts in the field of applying the concepts of managerial economics this can be done by giving the students case studies on managerial economics or managerial economics assignments and homework.
For example if we talk about production function then the question arises how one can use it practically in taking business decisions. One can easily predict with the help of production functions about how much production should be done, which production cycle to follow i.e. long run or short run, how to allocate the factors of production effectively to get maximum output out of them.
Likewise all the concepts of managerial economics can be put to use for strategic business decision making. As a student of management if you face problem on any topic of managerial economics, you can contact tutorhelpdesk for any kind of expert help, problem solving, assignment help and homework help.
The article is written by the tutor of tutorhelpdesk an online education company which is well aware of the changing trends of education sector and is proficient in providing best educational services to the students.
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