Archive for 'ECONOMICS' Category
MANAGERIAL ECONOMICS
Managerial Economics is the study of economics theories, logic and tools of economics analysis that are used in the process of business decision making. Economic theory and technique of economics analysis are applied to analyze business problems, evaluate business option and opportunities with a view to arriving at appropriate business decisions. Managerial Economics is thus constituted as that part of economics knowledge, logic, theories, and analytical tools that are used for rational business decision making.
Economics through, variously defined is essentially the study of logic, tools and technique of making optimum use of the available resources to achieve the given ends. Economics thus provides analytical tools and technique that managers need to achieve the goals of the organization they manage.
Baumaol has pointed out there main contributions of economics theory to business. First one of the most important ! unexpected end of formula.
Things which the economics theories can contribute to the management science is building analytical models which help to recognize of the structure of managerial problems, eliminate the minor details which might obstruct decision making and help to concentrate on the main issue. Secondly, economics theory contributes to the business analysis and set of analytical methods which may not be applied directly to specific business problems, but they do entrance the analytical capabilities of the business analyst.
Thirdly, economics theories offer clarity to the various concepts used in business analysis, which enable the managers to avoid conceptual pitfalls.
The areas of business issue to which economics theories can be directly applied may be broadly divided in two categories:-
(a) Operational or Internal issue and
(b) Environmental or External issue
(a) operational problems are of internal nature. They include all those problems which arise within the business organization and fall within in the preview and control of the management. Some of the basis internal issue are:-
(i) Choice of business and the nature of product i.e. what to produce;
(ii) Choice of size of the firm i.e. how much to produce
(iii) Choice of technology i.e. choosing the factor contribution;
(iv) Choice of price i.e. how to price the common;
(v) How to promote sales;
(vi) How to face price competition ;
(vii) How to decide on new investment;
(viii) How to manage profit and capital;
(ix) How to manage inventory i.e. stock of both finished goods and how material.
The microeconomic theories which deals most of these questions include:-
1. Theory of demand.
2. Theory of production and production decisions.
3. Analysis of market structure and pricing theory.
4. Profit analysis and profit management.
5. theory of capital and investment decisions.
TIME SERIES ANALYSIS
ReviewJournal of Economics : A carefully prepared and well written book. . . . Without doubt, it can be recommended as a very valuable encyclopedia and textbook for a reader who is looking for a mainly theoretical textbook which combines traditional time series analysis with a review of recent research areas.