microsoft power point - managerial economics [compatibility mode]

8/4/2019 Microsoft Power Point - Managerial Economics [Compatibility Mode]

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INTRODUCTION

TOMANAGERIAL ECONOMICS

C.M.JOSHI


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Learning objectives

To understand the nature and the scope of

Managerial Economics

How do managers make their decisions?


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Agenda

MEANING OF ECONOMICS


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Economics studies how societies

produce, distribute and consumematerial goods and services in face of

scarce resources.The problem ofscarcity arises due to

the mismatch between human wantsand available resources.

Meaning of Economics


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3 Central Problems Faced by a Society

What and how muchto produce?

How to produce?

For whom to

produce?


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TYPES OF RESOURCES

NATURAL

ENTERPRENEURIAL

HUMAN

CAPITAL

RESOURCES


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Agenda

TEN PRINCIPLES OF ECONOMICS WHICH

EVERY MANAGER MUST KNOW


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1. Scarcity leads to & choice leads to efficiency

2. Every human has to choose between

different desires

3. When Mb > Mc, decisions are taken4. Market mechanism is the best

5. But government does have a role to play

6. We respond to incentives

7. Productivity improves standard of living

8. Trade benefits all

9. Excess supply of money leads to inflation

10. Inflation and employment are incompatible.


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Agenda

MEANING OF MANAGERIALECONOMICS


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Managerial economics is the

use ofeconomic analysis to

make decisions involving the

best use of an organization's

scarce resources.

It is closely related tomanagement science (?)


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Evolution of Managerial Economics

Just few years ago, there was no separate

discipline known as managerial economics.However, with the beginning of the management

revolution the need for a specialized area knownas managerial economics was felt.

Managerial economics provides aharmonious link between economics

and various facets of businessstudies to facilitate managerialdecision making.


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Agenda

MANAGERIAL ECONOMICS &OTHER DISCIPLINES


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MANAGERIAL ECONOMICS

MARKETINGDemand

FINANCECapital

Budgeting

MANAGERIAL

ACCOUNTING

Break-EvenAnalysis

STRATEGY

MarketStructure

DECISION

SCIENCE

Forecasting


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Agenda

TYPES OF DECISIONS


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IMPLEMENT AND MONITOR THE

DECISION

CONSIDER

SOCIETAL

CONSTRAINTS

CONSIDER

ORGANISATIONAL

AND INPUT CONSTRAINTS

EVALUATE ALTERNATIVES

AND SELECT THE BEST

IDENTIFY POSSIBLE

ALTERNATIVE SOLUTIONS

DEFINE THE PROBLEM

IDENTIFY THE OBJECTIVES


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WHY SHOULD A FIRM BE IN

BUSINESS?THE FIRMS AND ITS GOALS

UNDERSTANDING

CONSUMER BEHAVIOUR

DEMAND ANALYSIS

PLANNING FOR THE

FUTURE

DEMAND FORECASTING


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TYPES OF DECISION MAKING

(CONTD)

CHOICE OF A

TECHNIQUE OFPRODUCTION

THEORY OF PRODUCTION

HOW TO CONTROL COSTS?THEORY OF COSTS

PRICING DECISIONSPRICE & OUTPUT


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TYPES OF DECISION MAKING

(CONTD)

STRATEGY BUILDINGENTRY AND EXIT OF FIRMS


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Summary

Managerial economics is the outcome

of management revolution.Managerial economics facilitates

decision makingIt is closely related to business

studies and other disciplines

microsoft power point - managerial economics [compatibility mode]

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