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Economics
For the successful handling of these activities certain laws and rules are
formulated which are known as various theories of economics.
Use of these rules & tools provided for analysing business conditions and
applying them for arriving at various economic decision is known as
managerial economics.
MicroEconomics & MacroEconomics
Microeconomics Macroeconomics
Derived from the greek word mikros Derived from the greek word makros
meaning “Small”. meaning “Large”
8) Minimizing Uncertainties:
4) Pricing Policies and Practices: Deciding the price is one of the important
subject of business economics. The success of a firm depends upon
decisions regarding prices.
Scope of Managerial Economics
The main focus of study in managerial Under economics all the distribution
economics is profit theory. theories like rent, wages and interest
are studied along with the theory of
profit.
Business Economics Vs Economics
c) Economic theories:
Helps to formulate economic theories.
Economist assume relationship between two variables & then collect data to
test it – Theory develops when assumption is valid.
d) Economic Forecasting:
Helps to predict future trends and change in one variable due to change in
another variable.
e) Forecasting of Policies:
Helps in policy formulation
Expected domestic production of wheat will help to determine imports
required for Wheat in 2018 based on expected demand of wheat in the
country in 2018.
d) Condensing Elaborate Date:
Per Capita Income(PCI) Vs remembering income of all citizens of a country.