Managerial Economics-

An Introduction
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Hello!
I am Abhinav Sachdeva
I am here to teach you about managerial economics.
⊸ What is “Economics”?

⊸ What is ‘ Micro and Macro economics?

⊸ What is Managerial Economics?

⊸ Nature, scope and significance of Managerial Economics

⊸ How it is useful to a Manager?

⊸ Functions of a Managerial Economist?

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our
class
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What is economics?
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Economics is a social science concerned with the :-

⊸ Production,
⊸ Distribution, and
⊸ Consumption of goods and services.

It studies how individuals, businesses, governments, and

nations make choices on allocating resources to satisfy their
wants and needs, trying to determine how these groups should
organize and coordinate efforts to achieve maximum output.
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Why do we study economics?

⊸ Resources are always scarce.

⊸ They are not only scarce, but also have
alternative uses.

& that is why their optimum allocation is

required.
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What is Microeconomics and

Macroeconomics ?
⊸ Microeconomics deals with the study of individual behaviour.
It deals with the equilibrium of an individual consumer,
producer, firm or industry.

⊸ Macroeconomics on the other hand, deals with economy wide

aggregates.
a) Determination of National Income Output, Employment
b) Changes in Aggregate economic activity, known as Business
Cycles
c) Changes in general price level , known as inflation, deflation
d) Policy measures to correct disequilibrium in the economy,
Monetary policy and Fiscal policy
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What is Managerial Economics?

⊸ “Managerial Economics is economics applied in

decision making. It is a special branch of economics
bridging the gap between abstract theory and
managerial practice” – William Warren Haynes, V.L. Mote,
Samuel Paul

⊸ “Integration of economic theory with business practice

for the purpose of facilitating decision-making and
forward planning” - Milton H. Spencer
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Nature, Scope and Significance of

Managerial Economics
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A picture is worth a thousand

words
A complex idea can be conveyed
with just a single still image,
namely making it possible to
absorb large amounts of data
quickly.
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Principles of Managerial Economics

⊸ The Incremental Concept

⊸ The Concept of Time Perspective
⊸ The Opportunity Cost Concept
⊸ The Discounting Concept
⊸ The Equi-marginal Concept
⊸ Risk and Uncertainty
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Utility Analysis
⊸ Utility is a psychological phenomenon; that implies the
satisfying power of a good or service.

⊸ It differs from person to person, as it depends on a

person’s mental attitude.

⊸ The measurability of utility is always a matter of

contention.

⊸ The two principal theories for the utility are cardinal utility
and ordinal utility. 
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Thank You!
Any questions?
You can mail me at sachdevaabhinav999@gmail.com