Introduction to managerial economics

Introduction to managerial economics

• 1.
  INTRODUCTION TO MANAGERIAL ECONOMICS UNIT I REFERENCE: MANAGERIAL ECONOMICS -DR. D.M MITHANI,
• 2.
  WHAT IS ECONOMICS? Root of the word ‘economics comes from Greek word ‘Oikonomia’ (management of household or household rules).  Economist’s dictionary of economics defines it as “The study of production, distribution and consumption of wealth in society’
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  WHAT IS ECONOMICS? Its basic function is to study how people- individuals, households, firms and nations – maximize their gains from their limited resources and opportunities.
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  Managerial Economics  Definition: “Managerial Economics is concerned with the application of economic concepts and economics to the problems of formulation rational decision making” – Mansfield  “Managerial Economics … is the integration of economic theory with business practice for the purpose of facilitating decision making and forward planning by management”
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  Nature of ManagerialEconomics  Micro Economic  Normative Micro Economics (what should do)  Pragmatic  Managerial Economics takes the help of macro economics
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  Scope of ManagerialEconomics I. What to produce? II. How to produce? III. For whom to produce?
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  Relationship to…. 1. Productionmanagement (strategic decisions, operating decisions and control decisions). 2. Marketing management(marketing strategy decisions, pricing decisions, value chain analysis, cost analysis.) 3. Finance management(financial decisions)
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  Relationship to…. 4. Personnelmanagement(strategic human resource, planning models, HR-performance management ) 5. Operation research (advanced analytical methods to make better economic and business decisions).
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  Role & ResponsibilitiesOf Managerial Economist