Why managers need to know economics?
Answers
Answer
Managerial economics is very much important for a manager to understand. It mainly deals with the development of economic theory of the firm and help the managers to take decision smoothly with regard to sales and profits. It also enables to take decisions about production as well as inventory policies for the future.
Explanation:
Managers need to have a basic understanding of economics to understand the concept of value. For example - product value or service value.
Value has a special meaning in economics since nothing has intrinsic value. It is only valuable if it is scarce or has a marketplace value. Meaning many people want it. It help the managers to take decisions firmly and smoothly with regards to sales and profits. It also enables to take decisions about productions as well as inventory policies for future.
HOPE YOU UNDERSTAND IT.
THANK YOU.