MANAGERIAL ECONOMICS

77問 • 1年前

問題一覧

Refers to the application of economic theory on the tools of analysis of decision science to examine how an organization can achieve its aims or objectives most efficiently

managerial economics

Managerial decision problems

economic theory decision sciences

Two types of economic theory

microeconomic macroeconomics

Two types of decision sciences

mathematical economics econometrics

Application of economic theory and decision science tools to solve managerial decision

managerial economics

The organization can solve its management decision problems by the application of _______ and the tools of _______

economic theory decision science

Refers to microeconomics and macroeconomics

economic theory

It is the study of economic behavior of individual decision making units, such as individual consumers, resource owners, and business firms, in a free enterprise system

microeconomics

Is the study of the total or aggregate level of output, income, employment, consumption, investment, and prices for the economy viewed as a whole

macroeconomics

Is also related to Decision Sciences

managerial economics

This use the tools of mathematical economics and econometrics to construct and estimate decision models aimed at determining the optimal behavior of the firm

decision sciences

Is used to formalize the economic models postulated by economic theory

mathematical economics

Then applies statistical tools to real world data to estimate the models postulated by economic theory and for forecasting

econometrics

Is the centerpiece and central theme of managerial economics

theory of the firm behavior

Is an organization that combines and organizes resources for the purpose of producing goods and services for sale

firm

A FIRM may include ____

proprietorship partnership corporation

It may include proprietorship, partnership, and corporation.

firm

It exists because it would be very inefficient and costly for entrepreneurs to enter into and enforce contracts with workers and owners of the capital, land, and other resources for each separate step of the production and distribution process.

firms

It exists in order to save on such transaction costs.

firm

By internalizing many transactions, it also saves on sales taxes and avoids price controls and other government regulations that apply to transactions among firms.

firm

To purchase resources or inputs of labor services, capital, and raw materials in order to transform them into goods and services for sale

functions of the firm

Then use the income generated from the sale of their services or other resources to firms to purchase the goods and services produced by firms

resource owners

Limitations on the availability of essential inputs

constraints on the operation of the firm

Limitations on factory and warehouse space

constraints on the operation of the firm

Limitations on quantity of capital funds available for a given project or purpose

constraints on the operation of the firm

Legal constraints

constraints on the operation of the firm

Limitations On The Theory Of The Firm

sales maximization model model of management utility maximization

Who created the Sales Maximization Model?

William Baumol

William Baumol created the ____.

sales maximization model

Managers of modern corporation seek to maximize sales after an adequate rate of profit has been earned to satisfy stockholders.

sales maximization model - William Baumol

Assumes that firms aim to maximize total sales subject to a minimum profit constraint.

sales maximization model - William Baumol

With the advent of the modern corporation and the resulting separation of management from ownership, managers are more interested in maximizing their utility, measured in terms of their compensation, the size of their staff, extent of control over the corporation, lavish officers that in maximizing corporate profits

model of management utility maximization - Oliver Williamson

With the advent of the modern corporation and the resulting separation of management from ownership, managers are more interested in maximizing their utility.

model of management utility maximization - oliver williamson

Refers to the conflict in interests and priorities that arises when one person or entity takes actions on behalf of another person or entity

principal-agent problem

Because of the great complexity of running the large modern corporation—a task often complicated by uncertainty and the lack of adequate data—managers are not able to maximize profits but can only strive for some factory goal in terms of sales, profit, growth, market share and so on

satisficing behavior - Richard Cyert, James March, and Herbert Simon

Who created the Model of Management Utility Maximization?

oliver williamson

Richard Cyert, James March, and Herbert Simon created the?

satisficing behavior

Oliver Williamson created the?

model of management utility maximization

Who created the Satisficing Behavior?

Richard Cyert, James March, and Herbert Simon

The two nature and functions of profits

business profit economic profit

Refers to the revenue of the firm minus the explicit or accounting costs of the firm

business profit

The actual out of the pocket expenditure of the firms to purchase or hire the inputs it requires for production

explicit cost

Equals to revenue of the firm minus its explicit costs and implicit cost

economic profit

Refer to the value of the inputs owned and used by the firm in its own production processes

implicit cost

Theories of profit

risk bearing theories of profit frictional theory of profit monopoly theory of profit innovation theory of profit managerial efficiency theory of profit

Above normal returns are required by firms to enter and remain in such fields as petroleum exploration with above average risks

risk bearing theories of profit

Similarly, the expected return on stocks has to be higher than on bonds because of the greater risk of the former

risk bearing theories of profit

It arise as a result of friction or disturbances from long run equilibrium

profits

Profits arise as a result of friction or disturbances from long run equilibrium

frictional theory of profit

That is, in long run, perfectly competitive equilibrium, firms tend to earn only a normal return or zero economic profit on their investment

frictional theory of profit

At any time however, firms are not likely to be in long run equilibrium and may earn a profit or incur a loss

frictional theory of profit

Some firms with monopoly power can restrict output and charge higher prices than under perfect competition, thereby earning profits

monopoly theory of profit

Because of the restricted entry to the industry these firms can continue to earn profits even in the long run

monopoly theory of profit

Economic profit is the reward for the instruction of a successful innovation

innovation theory of profit

If the average firm tends to earn only a normal return on its investment in the long run, firms that are more efficient than the average would earn above normal returns and economic profit

managerial efficiency theory of profit

Serves a crucial function in a free enterprise economy

profit

Signal that consumers want more of the output of the industry

high profits

Provide the incentive for firms to expand output and more firms to enter the industry in the long run

high profit

Signal that consumers want less of the commodity and/or that of production methods are not efficient

lower profits or losses

Provide the incentive for firms to increase their efficiency and produce less of the commodity and for some firms to leave the industry for more profitable ones

lower profits or losses

It therefore provide the crucial signals for the reallocation of societies resources to reflect changes and consumers taste and demand over time

profits

Is defined as a commodity or service being in short supply, relative to its demand

scarcity

Shortage or being short in supply

scarcity

It naturally occurs in the society because human wants and needs are UNLIMITED

scarcity

If society's demand exceeds the available resources, there is now a problem of resource allocation due to ____

scarcity

It is central in studying economics

scarcity

It is a science that deals with the management of scarce resources

economics

It is the study of how society allocates scarce resources and goods

economics

It is the scientific study on how individuals and the society make choices

economics

It is the study of the problem of using available economic resources as efficiently or possible to attain the maximum fulfillment of societies unlimited demand for goods and resources

economics

Two greek words for the origin of the term ECONOMICS

oikos nomus

OIKOS means

meaning household

NOMUS means

system of management

It means meaning household

oikos

It means system of management

nomus

OIKONOMIA or OIKONOMUS means

management of household

It means management of household

OIKONOMIA or OIKONOMUS

Business Finance

Sab Sescon · 46問 · 2年前

Business Finance