How managerial economics related to decision sciences?
Answers
Explanation:
MANAGERIAL ECONOMICS
Managerial economics is amanagement science that gives you more idea about theeconomic aspects of a market and how they affect your decision making. This is very important because economic profits play a crucial role in a market based economy., While above normal profits are indicators of expansion and growth, below normal profits cautions you abouttightening or retrenchment. Business economics is comprised of several tools of micro andmacroeconomic analysis which are useful in management decision-making that act as facilitatorsto solve business problems. Micro economic instruments used in this context include demandanalysis, production and cost analysis, breakeven analysis, theory of pricing, technical progress,location decisions and capital budgeting .
FACTORS INFLUENCING MANAGEMENT DECISIONS
The macroeconomic concepts that are directly or indirectly related to management decisionsinclude analysis of national income, business cycles, monetary policy, fiscal policy, central banking, public finance, economic growth, international trade, balance of payments, protectionism, free trade, exchange rates and international monetary system. The scope of management science is broad and is closely linked with economic theory, decision sciencesand accounting.Traditional economics deals with theory and methodology of management, while managerial or business economics applies these theories to solve business problems. The tools and analyticaltechniues are useful in providing optimal solutions to business problems.
Answer -
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- In all cases, costs and benefits occur, however intangible, and a decision must be made between different courses of action. As an approach to decision-making, managerial economics is related to economic theory, decision sciences and business functions. These relationships are now discussed.
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