No Marshmallows, Just Term Papers
MDU – MBA – 1st SEM. – JAN 2004
UNIT – 1
Q1. What is Managerial Economics? Discuss the characteristics and
scope of managerial economics. How does economic theory con-
-tribute to managerial decision ?
Ans. Economics is a social science, which studies human behavior
in relation to optimizing allocation of available resources to achieve the given ends .
The application of economic science is all
pervasive .More specifically economic laws and tools of economic
analysis are applied a great deal in the progress of business deci-
sion making . This has led to the emergence of a separate branch
of study called Managerial Economics .
“Managerial Economics is the study of eco-
-nomics theories, logic and tools of economic analysis that are
used in the process of business decision making . Economic theory
and technique of economic analysis are applied to analyze business
problems , evaluate business options and opportunities with a view
to arriving at appropriate business decision . Managerial economic
is thus constituted as that part of economic knowledge , logic ,
theories and analytical tools that are used for rational business
decision making .
Economics through ,variously defined is ess-
-entially the study of logic , tools and techniques of making opti-
-mum use of the available resources to achieve the given ends. Economics thus provides analytical tool and technique that managers need to achieve the goals of the organization they manage .
Baumaol has pointed out there main contributions of economic theory to business. First one of the most important !Unexpected End of Formula
things which the economic theories can contribute to the manage-
-ment science is building analytical models which help to recog-
-nize the structure of managerial problems ,...