What is Business Economics? Explain the scope of Business Economics.
Answers
The teaching of economics is, thus, an abstract theorization with little connection to business.
But theoretical models of economics are to be applied in business areas. Once theoretical models of economics are applied in business, the gap between economics and business gets minimised.
We know that managerial economics or business economics is applied microeconomics employed for the purpose of facilitating decision-making and forward planning. As far as decision-making and forward planning are concerned, one has to face the following problemsProblem of resource allocation seems to be a pressing problem for any organisation.
Resources are not plentiful. A firm has to organise scarce resources efficiently so that optimal outcomes are obtained. Such resource allocation problem includes production programming, transportation problem, etc. Non-optimal organisation of resources may spell disaster to any organisation.
Inventory and queuing