L1: Introduction for

Managerial Economics
TOPIC Midterms

SLIDES

CLASS MODE LECTURE

Completed

Date @February 9, 2022

What is Managerial Economics?

“Managerial Economics is concerned with the application of economic

concepts and economic analysis to the problems of formulating rational
managerial decisions.” - Mansfield

“It is the integration of economic theory with business practice for the
purpose of facilitating decision making and forward planning by
management.” – Spencer & Siegelman

“It is the economics applied in decision-making. It is a special branch of

economics bridging the gap between the economic theory and
managerial practice.” – W. W. Haynes

Economics for Managers or Business Economics

Concerned with finding optimal solutions to decision making

Nature of Managerial Economics

Application of different economic concepts, theories, and tools of

analysis to identify and analyze business environments, and to find
optimal solutions for different practical business problems.

L1: Introduction for Managerial Economics 1

 Applied Economics

Science and Art

Scope of Managerial Economics

Theory of Demand

Theory of production and production decisions

Analysis of market structure and pricing theory

Profit analysis and profit management

Theory of capital and investment decisions

What are the Relationship of Managerial Economics among the following:

Accountancy - Managerial Economics provide statistical and empirical

data to support the decisions making process in auditing.

Management Theory - Managerial economics guides the behavior of

business in achieving predetermined objectives made by the firm.

Mathematics & Statistics - Managerial economics rely on giving of

reliable and empirical information for businesses, and in order to offer
reliable data it is necessary to have a deep understanding in statistics.

Economics - Managerial economics is the application of the different

theories, tools, and techniques in both micro and macro economics in
order to maximize effective solutions in different business problems.

L1: Introduction for Managerial Economics 2