Managerial Economics is synchronized between the planning and control of any institution or firm and hence its importance increases. For a business executive, any information related to the future costs, sales or profit is not available. To start with, managerial economics provides a logical and experiential framework for analyzing the question. Free MBA Notes/Free BBA Notes/ MBA Study Material/ MBA Notes, B.Tech Biotechnology,MBA(HR and Marketing), UGC/CBSE NET Qualified. Business and industrial enterprise aims at earning maximum proceeds. It helps in assisting cost control and profit planning methods that helps in the increase of business profits. Therefore, it is known as the best option that aims at the achievement of particular objectives of an organization. In the business organization, managerial economics is important. It helps in formulating logical managerial decisions. In this process, an executive should take several alternatives so that he/she might reach to some conclusion based on the successful dealing of the given situation. The another meaning of decision making is the choice making and it emerges due to the fact that all type of business emerges due to certain type of changes in some conditions that could be operated and arise in unseen situations. Also, it allows the clear and accurate understanding of different existing conditions of the market … For a business executive, any information related to the future costs, sales or profit is not available. Monopoly – Meaning, Conditions, Sources and Advantages, Oligopoly – Meaning, Features and Sources – BBA/MBA Notes, Measurement of Inflation (Managerial Economics Notes) (BBA/MBA Notes), Demand Forecasting – Meaning, Scope, Types and Importance – Managerial Economics, Indifference Curve – Meaning, Nature, Assumptions, Properties and Limitations. Its main objective is to solve different problems of the business by analyzing variant business situations and the factors that contributes in a environment in which the business operates. Since managerial economics is concerned with such aspects and tools of analysis, it is pertinent to the decision making process. These factors are associated with business operation, knowledge of these factors aids the management in making sound business decisions. The managerial economics enables the contribution of the profitable business growth with effective business solutions of the problems that can change the economic scenario of the business opportunities that are feasible for business organizations. This service is unavailable right now. There are certain reasons based on the method of economics that could lead towards the overall development of the professionals at different levels. These factors can broadly be divided into two categories. Copyright ©2012-20 A2zservices PTE LTD. All Rights Reserved. I don't ordinarily comment but I gotta state thanks for the post on this perfect... Just wanted to say this website is extremely good. The branch of economics is applied in the analysis of all type of business decisions made in the firm or an organization. It aims at the development of economic theory of the firm while facilitating the decision making process with regard to sales and profits etc. MANAGERIAL ECONOMICS – AN OVERVIEW . It plays effective role in managing the forward planning and decision making in the internal operations of the business. In the processes of making decisions and planning for future, a business manager must show their involvement as it is considered as the integral or significant part of the whole management and operation system. It makes use of economic theory and concepts. It helps in making successful forecast by defining various objectives that could be help in reducing the risk of the business organization. It also allows taking decisions about appropriate productions and inventory policies that could be served for the future purposes. Related to any of the resource, after selecting an option, make plans about production along with the implementation of prices and materials to that specific option, both forward planning and decision making could work together. Importance of Managerial Economics Business and industrial enterprise aims at earning maximum proceeds. In the processes of making decisions and planning for future, a business manager must show their involvement as it is considered as the integral or significant part of the whole. A business can produce its goods so that it could be easily sold in the market only on the demand made by the customers present in the market. In the business organization, managerial economics is important.