FEATURES

OF
MANAGERIAL ECONOMICS
 FEATURES OF MANAGERIAL ECONOMICS:
• Microeconomics
• Managerial economics in character as it is
concerned with smaller units of the economy.
• It studies the problems and principles of an
individual business firm or an individual industry.
• It assists the management in forecasting and
evaluating the trends of market.
 FEATURES OF MANAGERIAL ECONOMICS:

• Normative economics
• Managerial economics belongs to normative
economics. It is concerned with what management
should do under particular circumstances.
• It determines the goals of the enterprise and then
develops the ways to achieve these goals.
• It deals with future planning, policy making, decision
making and making full utilization if available resources
of enterprise.
 FEATURES OF MANAGERIAL ECONOMICS:

• Pragmatic
• Managerial economics is pragmatic.
• It tries to solve the managerial problems in
their day to day functioning and avoids
difficult issues of economic theory.
 FEATURES OF MANAGERIAL ECONOMICS:

• Uses theory of firm

• Managerial Economics uses economic
concepts and principles which are known as
the theory of firm or economics of the firm.
• Thus, its scope is narrower than that of Pure
Economic theory.
 FEATURES OF MANAGERIAL ECONOMICS:

• Takes the Help of Macro Economics

Managerial Economics takes the help of
Macro-economics also because it needs an
understanding of the circumstances and
environment in which an individual firm or an
industry has to work.
 FEATURES OF MANAGERIAL ECONOMICS:
• Takes the Help of Macro Economics
Issues of Macro-economics whose knowledge
is necessary for the successful management of
a firm or an industry are : Business cycles,
Taxation policies, Industrial Policy of the
government, Price and distribution policies,
Wage policies and anti- monopoly policies etc.
 FEATURES OF MANAGERIAL ECONOMICS:

• Aims at helping the management

• Managerial economics aims at helping the
management in taking correct decisions and
preparing plans and policies for future.
 FEATURES OF MANAGERIAL ECONOMICS:

• Prescriptive rather than descriptive

• Managerial economics is a normative and
applied discipline.
• It not only describes the goals of an
organization but also prescribes the means of
achieving these goals.
 FEATURES OF MANAGERIAL ECONOMICS:
• A scientific art
• Managerial economics is called as scientific art
because it helps the management in the best and
efficient utilization of scares economic resources.
• It assists the management in finding out the most
feasible alternative. Managerial economics
facilitates good and result orientated decisions
under conditions of uncertainty.