State the characteristics of managerial economics, Managerial Economics

Assignment Help:

CHARACTERISTICS OF MANAGERIAL ECONOMICS

1. Uses theory of firm: Managerial economics uses economic principles and conceptsthat are known as theory of Firm or 'Economics of the Firm'. So its scope is narrower than that of pure economic theory.

2.  Takes the help of macroeconomics: Managerial economics incorporates certain aspects of macroeconomic theory. These are vital to comprehending the circumstances and environments which envelop the working conditions of an individual firm or an industry. Knowledge of macroeconomic issues liketaxation policies, business cycles, industrial policy of the government, price andwage policies, distribution policies and anti-monopoly policies and so on, is integral to successful functioning of a business enterprise.

3. Objectives at helping the management: Managerial economics aims at supporting management in taking corrective decisions and charting plans as well as policies for future.

4. A scientific art: Science is a system of principles and rules engendered for attaining given ends. Scientific methods have been credited as optimal path to achieving one's goals. Managerial economics has been is also known as a scientific art since it helps the management in the efficient and best utilisation of scarce economic resources. It considers production costs, price, demand, risk, profit etc. It helps the management in singling out the most feasible alternative. Managerial economics facilitates result oriented and good decisions under conditions of uncertainty.

5.  Prescriptive instead of descriptive: Managerial economics is anapplied and normative discipline. It proposes the application of economic principles with regard to policy formulation, decision-making and future planning. It not only defines the goals of an organisation but also prescribes the means of   achieving these goals.

 

 


Related Discussions:- State the characteristics of managerial economics

Borrowing facilities internationally, Borrowing Facilities If a countr...

Borrowing Facilities If a country's currency is not convertible, it can borrow from countries whose currencies are convertible and use the convertible currencies to make its i

Practical importance of knowledge-price elasticity of demand, Practical Imp...

Practical Importance of the knowledge of Price Elasticity of demand The practical importance of the measures of elasticity of demand is to be appreciated in various ways:

Explain about the equilibrium in the labor market, Explain about the equili...

Explain about the equilibrium in the labor market. Equilibrium into the Labor Market: All of firm will hire labor up to the point at that the value of the marginal product o

Discount rate (bank rate), Discount Rate (Bank Rate) This is the rate ...

Discount Rate (Bank Rate) This is the rate on central bank advances and is also called official discount rate or "minimum lending rate".  When commercial banks find themselves

Bertrand equilibrium benefits, The computer graphics chip industry is one w...

The computer graphics chip industry is one with a little number of competitors that earn normal economic profit. Two chip manufacturers, NVIDIA and ATI both face the prospect of lo

The individual and market demand curves, The individual and market demand c...

The individual and market demand curves The quantities and prices in the demand schedule can be plotted on a graph. Such a graph after the individual demand schedule is called

Show the isoquant touching axis, Q. Show the Isoquant touching axis? I...

Q. Show the Isoquant touching axis? Isoquants do not intersect: By definition isoquants such as indifference curves, can never cut each other. If they cut each other it will

Explain the theory of production, Explain the Theory of Production Co...

Explain the Theory of Production Cost and Production analysis is central for the unhampered functioning of the production process and for project planning. Production is an e

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd