Subject of Managerial Economics

1. 1.2 Roles & Responsibilities of
Managerial Economist

2. ROLES OF MANAGERIAL ECONOMIST
 As Environmental Studies
- An analysis and forecast of external factors ., prices, national
income and output, volume of trade, etc., are of great significance since
every business firm is affected by them.
- To study the economic trends at the macro-level interpret their
relevance to the particular firm.
- To digest the ever-growing economic literature and advise top
management by means of short, business-like practical notes.
- He pragmatically interprets the intentions of controls and
evaluates their impact.
- He acts as a bridge between the government and the
industry, translating the government’s intentions and transmitting the
reactions of the industry
 In Business Operations
- To help the management in making decisions in internal
operations, investment, expansion or contractions , Reasonable sales
and profit budget for the next year
- In production schedules and inventory polices
- Changes in wage and price policies & Cash Management

3.  Specific Functions
- Sales forecasting, Industrial marketing
research, Economic analysis, Capital projects, Production
programs, Security / investment analysis and forecasts,
- Advice on trade and public relations, primary
commodities , foreign exchange, Analysis of
underdeveloped economies, Environmental forecasting
 Economic Intelligence
- They also provide general intelligence service
supplying management with economic information of general
interest such as competitors’ prices and products, tax
rates, tariff rates etc.

4. RESPONSIBILITY OF A MANAGERIAL ECONOMIST
 Managerial economist has to keeps in mind the main objective
of his business, viz., to make a profit on its invested capital.
 Management decision necessarily concern future which is
rather uncertain. Hence it is his responsibility to make
successful forecasts.
 He will have to make these forecasts on the basis of data on
the market conditions, the general economic environment.
 A managerial economist is supposed to forecasts the trend
and shifts in sales, profits, demand, cost, etc.
 If the managerial economist finds due to some sudden and
unaccounted factors, the presented forecast has undergone a
change, it is his duty to work out the new forecast and present
it at the earliest possible time.
 A managerial economist should have the ability to obtain
necessary information quickly by personal contacts rather
than by lengthy research.