1(i) Managerial economics
(ii) What is Managerial Economics?
The integration of economic management into the decision-making process is essential to ensure that each company can achieve a competitive advantage. According to Mark Diru and Erik Benten, economic governance is a study of how economic forces influence institutions and how their leaders use economic principles to achieve the best results. This concept, from large companies to non-profit organizations in all sectors of the economy, is a clever tool that helps to properly implement business decisions.
In the decision-making process for every entrepreneur, it is essential for the economy to get a real competitive manager.
They can be used to study the principles of economy, management and business, and Mark Deery to force organizations to achieve the best results, according to Eric Bentzen, how their executives affect the business.
The administrative economy administrator uses the management economy to make the most appropriate decisions for the organization.
The problem you may be resolving is:
• Product selection or development
• Determine product pricing
• Internet strategy Development
• Organizational Design
• Promotional Strategies
• Employee recruitment and training
• Use a specific concept and quantitative methods to maximize the use of investment and finance, especially in the management economy, resources and at least
• Marginal analysis.With marginal analysis as a study for changes caused by economic decisions, the company can know whether the price is rising and the customer decides to buy the product.
• The theory of public choice (according to an encyclopedia of Simple economics) helps companies to understand the decision-making behavior of the masses.
• The company’s theory describes some of the basic models of commercial companies. • Game theory techniques.
Research on how people interact can help companies understand the behavior of a broader clientele based on consumer behavior.
• Technology optimization or how to use your company’s available resources.
• Forecast sales procedures or try to understand future conditions like yours. Understanding the concept of leader communication.
1(iii) Differentiate between managerial economics and other disciplines?
1(iv) Relationship with economic theory
An important branch of economic theory, the economy of business related to the micro-economy, how the market works and the economic interaction between the various components basically covers.
In particular the next side of the micro-theory is connected: The Company Theory of 1 2 consumer behavior theory (question) 3 production and cost theory (supply) 4 Price theory 5 market structure and competition theory.
At this point it is appropriate to confirm that the theory is in many ranges investigated and discussed in the Neo-classical framework. By default, it is a way of considering individual elements (consumers, businesses and workers) in the economy to be rational actors with the purpose of expressing themselves in a quantitative manner (utility revenues and revenues). This method often criticizes as outdated and unrealistic, but can be defended for three reasons. The first is that it is very diverse and easy to justify for many situations and expand, for example, the cost of transactions, the cost of information, incomplete knowledge, risks and uncertainty, because there are multiple situations often to ignore. At this point it is necessary to make another very important difference: between the positive and normative economy. This is sometimes referred to as a distinction between ‘ I s ‘, but in fact this is somewhat misleading. A statement that is inherently positive is a statement of truth or false facts through empirical study or logic. It is not possible to confirm the empirical research and logic by the standard indication that the judgement of the value is accompanied. Compare the statements as the next two.
1 A British income distribution is not the same.
2 The distribution of income in England is unfair. First, a positive person will be the second rule. The general statement means that the above example recommends that revenues be redistributed in many cases. But because these statements are regulatory, they can actually be rules. For example, the door ‘ Enterprise x must increase the price to increase profits ‘ is a positive affirmation. This is because the word “must ” is used in one of the other phrases, predicated here. Implicitly, there is no verdict of value. In fact, it can be difficult to differentiate between two types of statements, especially if they are linked in the same sentence. The investigation is related to the above?
1(v) Relationship with decision sciences
The science of decision making provides tools and techniques of analysis used in the business economy. The most important aspects are: * Numerical and analysis
* Statistical estimation and Forecasting
* Risk and uncertainty analysis
* Update and time values-monetary technology because these tools and technologies are introduced in appropriate circumstances, they can be applied immediately to identify relevance rather than independently discussed and blocked.
1(vi) Relationship with business functions
Every organization consists of a structure that is organized into different departments or units, but it is not necessarily official. Typically, the following units are included:
1 production and Operation
3 financial and accounting
4 human resources all these functional areas are subject to the aforementioned theories and methods in the context of each situation and the work they have to perform. So you can plan your production department and plan your performance for the next quarter, the marketing department may decide what rates you would like to know and how much you spend on advertising, if you want to build a new plant in the finance department, and you may want to know how many people the HR department is next. It is important to note that all of the above decisions include some sort of quantitative analysis. Not all administrative decisions include this type of analysis. There are decision areas that do not apply to company management tools and technologies. For example, a Sales Manager can motivate a vendor to provide a performance level greater than 10 referrals. In This case, the behavior and understanding and applicability of psychological principles are relevant. While economists do not say they can ignore it, business economics tends to focus more on behavioral problems when it concerns consumers, not when it concerns the behavior of workers.