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The representation of different combinations of two goods on a curve is done by indifference curve that provides a consumer equal level of satisfaction. Between these curves the consumer is indifferent as he gets equal satisfaction from all the combinations.
Forecasting is a technique that facilitates the process of planning and enabling efficient decision-making. By this estimates, projections are made for the future. Combining the aspect of forecasting with demand, it serves with the future projections regarding the quantity demanded in precise. Certain questions like which product will be in demand
An algebraic expression which shows the relationship between demand for a commodity and its various determinants that affect this quantity is known as demand function.
“A consumer is in equilibrium when he regards his actual behaviour as the best possible under the circumstances feels no urge to change his behaviour as long as circumstances remain unchanged”.
utility is value-in- use of a commodity. Utility is the derivative of consumption which implies subjective satisfaction. Simply, ‘utility’ describes consumer preferences according to modern theory of consumer behaviour.
The demand refers to a consumer’s willingness for such quantity of goods and services and ability to pay for same at various prices dealing within a period of time. In economics, demand is something more than desire to purchase. For example, if any person is feeling hunger but he does not have money to pay for it, in that case his demand is ineffective. Effective demand involves three things Desire,
Means to purchase, and Willingness to use those means for that purchase.
1.Opportunity Cost Principle
The sacrifice of alternative courses of action for any decision is referred to as opportunity cost. Opportunity cost may be defined as, ‘the revenue foregone or opportunity lost by not using the resources in second best alternative use’. It is also called imputed cost. Measurement of sacrifice is done by opportunity cost. The sacrifice which is made for taking a decision is measured by opportunity cost. This concept can be explained by following points.
Managerial Economics and Statistics: Statistical tools are playing very important role in business decision-making. Statistical techniques are used in collecting, processing and analysing data, testing the validity of the economic laws with the real economic phenomenon before they are applied to business analysis.
Here we will discuss the top 7 importance of managerial economics or you can say the significance of managerial economics in a business or as an organization. If you want to perform better then you need to understand managerial economics. Let’s start and read till to end. Managerial economics uses economic theory and analysis in business…
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Micro-Economic in Nature: The branch of economics which deals with individual units of an economy is called micro-economics. These individual units may be either a firm or a person or a group of firms or a group o persons.
Pragmatic: Managerial economics is practical in nature. Rigid and abstract theoretical framework are provided by managerial economics to managers. It is said to be pragmatic in nature because it avoids complex abstract issues of economic theories at one end
