A Review of Nature and Scope of Managerial Economics

Economics impacts our day-to-day lives. Economics also influences the decisions taken by managers of business firms. Any business is part of an economy. As we know, economic conditions heavily impact business activities and vice versa. The per capita income of the citizens will define the purchasing power on the basis of which, the business enterprises will decide what products to manufacture and sell. A new enterprise has to forecast the demand for the product, which it wants to sell. The day to day product market has to decide a viable price depending upon the interaction between the demand and the supply. Thus, management practitioners and academicians brought economics to their perspective and developed ‘Managerial Economics’.