This document provides an introduction to managerial economics. It defines economics as the study of generating wealth and discusses how managerial economics applies economic theory to managerial decision making and planning. Managerial economics uses microeconomic analysis to help managers understand their environment and make optimal resource allocation decisions to maximize benefits within the firm. It is a pragmatic field that blends economic concepts with quantitative techniques to inform practical, correct decision making around production, demand, price, profit, and risk.

1. Introduction to Managerial Economics
Dr. NGPASC
COIMBATORE | INDIA
Dr. N.G.P. ARTS AND SCIENCE COLLEGE
(An Autonomous Institution, Affiliated to Bharathiar University, Coimbatore)
Approved by Government of Tamil Nadu and Accredited by NAAC with 'A' Grade (2nd Cycle)
Dr. N.G.P.- Kalapatti Road, Coimbatore-641048, Tamil Nadu, India
Web: www.drngpasc.ac.in | Email: info@drngpasc.ac.in | Phone: +91-422-2369100
RAJAKRISHNAN M
Assistant Professor in Commerce CA

2. Dr. NGPASC
COIMBATORE | INDIA
Meaning - Economics
Social Science
Analyse
Production and
Distribution
Consumption of
Goods and
Services
Ancient Greek
Word
“Oikonomia”
‘Oikos’ = ‘House’
‘Nomos’ =
‘Management’
Managing a household and Admin.

3. Dr. NGPASC
COIMBATORE | INDIA
Definition - Economics
Adam Smith
Founder
Wealth
Study of Generating wealth of the nation
Samuelson’s
Modern Definition of Economics
Employ its resources
To produce Goods and Services
Present and future consumption

4. Dr. NGPASC
COIMBATORE | INDIA
Managerial Economics ?
Application of Economic Theory to Managerial Practice
Right Decision in Right Time
Spencer and Siegelman
Decision making and forward planning

5. Dr. NGPASC
COIMBATORE | INDIA
Nature of Managerial Economics
Micro in Character:
Within the firm
Normative in Character:
Policy formulation and decision making & future planning
Macro in nature:
Understand and adjust the environment
Conceptual and Metrical:
Understand and analyse the decision problems
Quantitative techniques to measure the impact of different factors
and policies

6. Dr. NGPASC
COIMBATORE | INDIA
Nature of Managerial Economics
Allocation to scare resources:
To maximize the benefit
Pragmatic:
Practical
Not just Theory
Economics of the firm:
Economics concepts and principles
Supporting the Management:
Decisions
Correct
Scientific Art:
Considers cost of production
Demand
Price
Profit and risk