Maravilla, Justine Lloyd O.

4/13/2023

ACT224 Managerial Economics

Assignment #2
1. What is managerial economics and how does it relate to the development of a manager?

Managerial economics is when you use economics to help you make good decisions for a
business. Basically, you look at economic concepts and methods to solve problems in business. Knowing
this stuff is super important if you want to be a good manager because it helps you make good decisions
that can help your company be successful. By learning about supply and demand, cost-benefit analysis,
and market structures, you can make smart choices about things like prices, production, and using
resources. Plus, you can also use what you learn to stay ahead of changes in the market and come up
with good strategies to keep your company competitive. All in all, knowing about managerial economics
can help you make good choices that lead to a successful business.

2. What are the main objectives of managerial economics?

Managerial economics is all about assisting managers in making informed decisions and
resolving issues in the workplace. Giving managers the resources they need to make well-informed
decisions and assess how those decisions will impact the business are the main objectives of
management economics. Managers can make decisions that increase the business's profitability and
efficiency by researching factors like demand, supply, production, cost, market structure, and pricing.
Maintaining market relevance, identifying fresh growth prospects, and raising overall competitiveness
are other objectives of management economics. Therefore, the primary premise is that management
economics aids managers in making wise decisions and resolving issues in the workplace.

3. According to the article, what are some of the key concepts and tools that managers should be
familiar with in order to make effective decisions?

The article discusses the information managers need to have in order to make wise decisions.
The ability to motivate employees, solve problems, communicate effectively, and use technology like
computers and phones are all essential talents for managers. They ought to be able to inspire their
workers, create a positive work environment, and address issues. Effective meeting management and
effective communication skills are essential for managers. Technical abilities include things like report
writing and data analysis. All of these abilities will aid managers in improving their organization's
effectiveness and decision-making.
4. What is the relationship between managerial economics and other disciplines, such as finance,
accounting, and marketing?

The use of economics to support business decision-making is known as managerial economics.

In essence, you take economic theories and methods into account when resolving business problems.
Having a firm grasp of this knowledge will enable you to make informed judgments that will aid your
company if you want to be a competent manager. By comprehending supply and demand, cost-benefit
analysis, and market structures, you can make informed decisions regarding issues like prices,
production, and resource use. Additionally, you may use what you learn to keep up with market
developments and create strong plans to maintain your company's competitiveness.

5. Based on the article, what are some of the challenges that managers may face when applying the
principles of managerial economics to real-world situations?

Managers face challenges when applying the principles of managerial economics to real-world
situations. One challenge is that real-world situations are complex and have many variables and
uncertainties that can affect decisions. Managers need to adapt principles to the specific context of their
organization and consider trade-offs between options. Another challenge is resistance to change from
employees and stakeholders. Managers need to communicate and involve stakeholders in decision-
making and provide incentives to encourage acceptance of changes. Lastly, ethical principles such as
fairness, justice, and social responsibility can conflict with the objective of maximizing profits and
minimizing costs. Managers need to consider ethical implications and balance the interests of
stakeholders.