Managerial Economics (MBA - I Semester Paper Code: MBAC Managerial EconomicsO) Download PDF. Downloading. Anagerial Economics, Cengage Learning, Newdelhi, Geetika, Ghosh & Choudhury,, 4. Available in PDF, ePub and site. Managerial Economics or Business Economics subject is covered in simple explanation by this book and requires special. ECONOMICS FOR MANAGERS. raudone.infoTTA and precepts;Managerial economics: its uses& . Managerial Economics, Geetika,. Piyali Ghosh, Purba.
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I think this can solve your problem. If not then let me know raudone.info coursepack/Management/raudone.info Students can Download MBA 1st Sem Managerial Economics Notes Pdf Anagerial Economics, Cengage Learning, Newdelhi, Geetika. Managerial Economics by G Geetika, , available at Book Depository with free delivery worldwide.
A few goods like diamonds etc aredownloadd by the rich and wealthy sections of society. The prices of thesegoods are so high that they are beyond the reach of the common man.
Thehigher the price of the diamond, the higher its prestige value. So whenprice of these goods falls, the consumers think that the prestige value ofthese goods comes down. So quantity demanded of these goods falls withfall in their price. So the law of demand does not hold good here. Conspicuous Necessities: Certain things become the necessities of modern life. So we haveto download them despite their high price. The demand for T. These things have become the symbol of status.
Sothey are downloadd despite their rising price. This is especially true,when the consumer believes that a high-priced and branded commodity isbetter in quality than a low-priced one. Emergencies: During emergencies like war, famine etc, households behave in anabnormal way.
Households accentuate scarcities and induce further pricerise by making increased downloads even at higher prices because of theapprehension that they may not be available. On the other hand duringdepression, , fall in prices is not a sufficient condition for consumers todemand more if they are needed.
Future Changes In Prices: Households also act as speculators. When the prices are risinghouseholds tend to download large quantities of the commodity out of theapprehension that prices may still go up. When prices are expected to fallfurther, they wait to download goods in future at still lower prices.
So quantitydemanded falls when prices are falling. Change In Fashion: A change in fashion and tastes affects the market for a commodity. When a digital camera replaces a normal manual camera, no amount ofreduction in the price of the latter is sufficient to clear the stocks. Digitalcameras on the other hand, will have more customers even though its pricemay be going up.
The law of demand becomes ineffective. Demonstration Effect: It refers to a tendency of low income groups to imitate theconsumption pattern of high income groups.
They will download a commodityto imitate the consumption of their neighbors even if they do not have thedownloading power. Snob Effect: Some downloaders have a desire to own unusual or unique products toshow that they are different from others. In this situation even when theprice rises the demand for the commodity will be more. Whenever the prices rise, the traders expect the prices to rise further sothey download more.
Goods that go out of use due to advancement in the underlyingtechnology are called outdated goods. The demand for such goods doesnot rise even with fall in prices Seasonal Goods: Goods which are not used during the off-season seasonal goods will also be subject to similar demand behaviour.
Goods In Short Supply: Goods that are available in limited quantity or whose futureavailability is uncertain also violate the law of demand.
Elasticity Of Demand In economics, the term elasticity means a proportionate percentage change in one variable relative to a proportionate percentage change inanother variable. The quantity demanded of a good is affected by changesin the price of the good, changes in price of other goods, changes in incomeand changes in other factors. Elasticity is a measure of just how much ofthe quantity demanded will be affected due to a change in price or income.
Elasticity of Demand is a technical term used by economists todescribe the degree of responsiveness of the demand for a commoditydue to a fall in its price. A fall in price leads to an increase in quantitydemanded and vice versa. The responsiveness of changes in quantity demanded due to changesin price is referred to as price elasticity of demand. The price elasticityof demand is measured by dividing the percentage change in quantitydemanded by the percentage change in price.
When there is afall in price to Rs. Thereforethe change in quantity demanded is12 units resulting from the change inprice of Rs. The two factors considered by economists arethe availability of substitutes and time. The better the substitutes for aproduct, the higher the price elasticity of demand..
The longer the periodof time, the more the price elasticity of demand for that product.
The priceelasticity of necessary goods will have lower elasticity than luxuries. The elasticity of demand depends on the following factors: 1. Nature of the commodity: The demand for necessities is inelastic because the demand does not change much with a change in price. But the demand for luxuries is elastic in nature. Extent of use: A commodity having a variety of uses has a comparatively elastic demand. Range of substitutes: The commodity which has more number of substitutes has relatively elastic demand.
A commodity with fewer substitutes has relatively inelastic demand. Income level: People with high incomes are less affected by price changes than people with low incomes. Proportion of income spent on the commodity: When a small part of income is spent on the commodity, the price change does not affect the demand therefore the demand is inelastic in nature.
For example medicines for any sickness should be downloadd and consumed immediately.
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Durability of a commodity: If the commodity is durable then it is used it for a long period. Therefore elasticity of demand is high. Price changes highly influences the demand for durables in the market.
Time: In the short run demand will be less elastic but in the long run the demand for commodities are more elastic. The slope of each combination is depicted in thefollowing graphs. Income Elasticity Income elasticity of demand measures the responsiveness ofquantity demanded to a change in income. It is measured by dividing thepercentage change in quantity demanded by the percentage change inincome.
If the demand for food were unchanged whenincome increases, the income elasticity would be zero. A fall in demand fora commodity when income rises results in a negative income elasticity ofdemand. Unitary Income Elasticity: The change in income leads to the samepercentage of change in the demand for the good. Income Elasticity is Greater than 1: The change in income increases thedemand for that commodity more than the change in the income.
Income Elasticity is Less than 1: The change in income increases thedemand for the commodity but at a lesser percentage than the change inthe Income. We can understand from the abovegraphs that the product which is highly elastic in nature will grow fasterwhen the economy is expanding. The performance of firms having lowincome elasticity on the other hand will be less affected by the economicchanges of the country. The income elasticityof demand is positive for superior goods or normal goods and negative forinferior goods since a person may shift from inferior to superior goodswith a rise in income.
Cross elasticity measures theresponsiveness of the quantity demanded of a commodity due to changes inthe price of another commodity. For example the demand for tea increaseswhen the price of coffee goes up. Here the cross elasticity of demand fortea is high.
If two goods are substitutes then they will have a positive crosselasticity of demand. In other words if two goods are complementary toeach other then negative income elasticity may arise. The responsiveness of the quantity of one commodity demandedto a change in the price of another good is calculated with the followingformula.
For example the price fall in Tata salt does not make any change in thedemand for Tata Nano. Significance Of Elasticity Of Demand: The concept of elasticity is useful for the managers for the followingdecision making activities1.
In production i. Price fixation i. In distribution i. In international trade i. In foreign exchange6. For nationalizing an industry7. In public finance 31 Demand Forecasting All organizations operate in an atmosphere of uncertainty butdecisions must be made today that affect the future of the organization.
There are various ways of making forecasts that rely on logical methodsof manipulating the data that have been generated by historical events. A forecast is a prediction or estimation of a future situation, under givenconditions. Demand forecast will help the manager to take the followingdecisions effectively.
Define the nature of the forecasting problem 2. Explain the nature of the data under investigation 3. Describe the capabilities and limitations of potentially useful forecasting techniques. Develop some predetermined criteria on which the selection decision can be made. Demand Forecasting Methods: 1. Delphi method 3. Expert opinion 4. Collective opinion 5. Smoothing techniques 7. Controlled experiments 9. The following are various trend projections used under variouscircumstances.
Tocalculate Y for any value of X we have to solve the following equations, i and ii. When forecasting trend series then, moving averages, simpleregression, growth curves, exponential models and autoregressiveintegrated moving average ARIMA models and Box-Jenkins methodscan be used. When forecasting cyclical series econometric models, economicindicators, multiple regression and ARIMA models can be used. The causal forecasting models simple, multiple regressionanalysis will be useful to decide the production, personnel hiring, andfacility planning in the short run.
In Time series forecasting models likedecomposition is suitable to decide the new plant, equipment planning. Moving average and exponential smoothing is used for operations such asinventory, scheduling and pricing decisions. The autoregressive models,Box-Jenkins techniques are used to forecast price, inventory, production,stock and sales related decisions. Neural network method is for forecastingapplications in development phase of the organization.
Apart from the above mentioned statistical methods the survey methodsare also commonly used. They are: 1. Complete Enumeration Method: the survey covers all thepotential consumers in the market and an interview is conducted to findout the probable demand. The sum of all gives the total demand for theindustry.
If the number of customers is too many this method cannot beused.
Sample Survey Method: the complete enumeration is notpossible always. The forecaster can go in for sample survey method. Inthis method, only few a sample customers are selected from the total andinterviewed and then the average demand is estimated. The above discussed qualitative and quantitative methods are commonlyused to forecast the future demand and based on this information firmswill take production decision.
Define demand. State the law of demand. Prepare a demand schedule for an apple i-pad in the Indian market. Distinguish between shift in demand and a movement along a demand curve. List out the factors which determine market demand for a commodity of your choice. Categorize the types of demand with proper examples. What is meant by industry demand and company demand? Explain perfectly elastic demand and perfectly in elastic demand with a suitable example. Explain the concept of cross elasticity of demand with an example.
Explain the concept of income elasticity of demand and discuss the importance of income elasticity of demand for a business firm. What are the different types of price elasticity of demand? Explain the slope of income demand curve for a superior and inferior good.
Discuss the cross elasticity of demand with an example. List out the significance of elasticity of demand in managerial decision making. What is meant by demand forecasting?
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Why is it important for the managers of business firm? Why do business entities have to forecast demand? What are the quantitative and qualitative methods of demand forecasting? Discuss the steps to be followed during demand forecast. Mention the major criteria to choose a suitable forecasting method. Explain the consumer survey method and discuss the merits and demerits of complete enumeration method and sample survey method. Find outthe cross elasticity of demand for the two. What is the nature of theirrelationship?
Explain c Try to collect 10 to 20 years sales details of a company and forecasttheir demand for the next year and find out the demand for the same after5 years from now. Fit the linear equation and draw the trend line. Andsuggest short term and long term decisions to be taken in the organizationto meet the future demand. Supply is also sometimesinelastic and sometimes elastic.
The managers have to take wise decisionsto maximize the profits of the firm. Supply is what theseller is able and willing to offer for sale.
The Quantity supplied is theamount of a particular commodity that a firm is willing and able to offerfor sale at a particular price during a given time period. Supply Schedule: is a table showing how much of a commodity, firms cansell at different prices. Law of Supply: is the relationship between price of the commodity andquantity of that commodity supplied. Supply Curve: A graphical representation of how much of a commodity afirm sells at different prices.
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The supply curve is upward sloping from leftto right. Therefore the price elasticity of supply will be positive. Graph - Supply curveDeterminants Of Supply: 1. The cost of factors of production: Cost depends on the price of factors. Increase in factor cost increases the cost of production, and reduces supply. The state of technology: Use of advanced technology increases productivity of the organization and increases its supply.
External factors: External factors like weather influence the supply. If there is a flood, this reduces supply of various agricultural products. Tax and subsidy: Increase in government subsidies results in 42 more production and higher supply. Transport: Better transport facilities will increase the supply. Price: If the prices are high, the sellers are willing to supply more goods to increase their profit. Elasticity of Supply: Elasticity of supply of a commodity is defined asthe responsiveness of a quantity supplied to a unit change in price of thatcommodity.
Perfectly inelastic: If there is no response in supply to a change in price. Factors Influencing Elasticity Of Supply 1. Nature of the commodity: If the commodity is perishable in nature then the elasticity of supply will be less.
Durable goods have high elasticity of supply.
Time period: If the operational time period is short then supply is inelastic. When the the production process period is longer the elasticity of supply will be relatively elastic.
Size of the firm and number of products: If the firm is a large scale industry and has more variety of products then it can easily transfer the resources. Therefore supply of such products is highly elastic. Natural factors: Natural calamities can affect the production of agricultural products so they are relatively inelastic. Nature of production: If the commodities need more workmanship, or for artistic goods the elasticity of supply will be high.
Apart from the above mentioned factors future expectations of the market,natural resources of the country and government controls can also play arole in determining supply of a good. In the long run, supply is affected bycost of production. If costs are rising, some of the existing producers maywith draw from the field and new entrepreneurs may be scared of enteringthe field.
The mangers will have to procure the right level of thesefactors based on factors like diminishing marginal utility economies oflarge scale operations, law of return, scales etc. Production function brings out therelationship between inputs used and the resulting output.
The firm has to decide as to howmuch to produce and how much input factors labour and capital toemploy to produce efficiently. This chapter helps to understand the set ofconditions for efficient production of an organization. Factors of production include resource inputs used to produce goods andservices. Economist categorise input factors into four major categoriessuch as land, labour, capital and organization. Land: Land is heterogeneous in nature.
The supply of land is fixed andit is a permanent factor of production but it is productive only with theapplication of capital and labour. Labour: The supply of labour is inelastic in nature but it differs inproductivity and efficiency and it can be improved. Capital: is a man made factor and is mobile but the supply is elastic. Organization: the organization plans, , supervises, organizes and controlsthe business activity and also takes risks. It decideson the maximum output to be produced from a given level of input, andhow much minimum input can be used to get the desired level of output.
The production function assumes that the state of technology is fixed. Ifthere is a change in technology then there would be change in productionfunction. As amanager ,he has to know the price of the input factors and the budgetallocation of the organization.
The major objective of any businessorganization is maximizing the output with minimum cost. To achieve themaximum output the firm has to utilize the input factors efficiently. In thelong run, without increasing the fixed factors it is not possible to achievethe goal.
Therefore it is necessary to understand the relationship betweenthe input and output in any production process in the short and long run. Cobb Douglas Production Function: This is a function that defines the maximum amount of output thatcan be produced with a given level of inputs. Let us assume that all inputfactors of production can be grouped into two categories such as labour L and capital K. Short Run Production Function: In the short run, some inputs land, capital are fixed in quantity.
The output depends on how much of other variable inputs are used. Faraut, B. Napping reverses the salivary interleukin-6 and urinary norepinephrine changes induced by sleep restriction. Griffiths, S. Public health in practice: The three domains of public health. Public Health, 10 , - Perspectives on the study of work-life balance.
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Combat stress at work to promote health. Focus Apr. Relationship between work-life balance, turnover intention, and organisational support for work-life balance : A study in the IT industry in Kerala. Prabandhan: Indian Journal of Management, 9 5 , 33 - DOI: Work-life balance: Key issues. Jones, R.
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Kotwal, N. Impact of work and environment on women living in urban slums. Studies on Home and Community Sciences, 2 2 , 93 - Kshirsagar, V. International Journal of Multidisciplinary Research and Development, 2 6 , - Ljungblad, C. Workplace health promotion and working conditions as determinants of employee health.
International Journal of Workplace Health Management, 7 2 , 89 - Work-life balance in Europe: A response to the baby bust or reward for the baby boomers? European Societies, 8 2 , - In Wikipedia. Symptoms in women computer users and ergonomics solutions. Purohit, M. A comparative study of work life balance in various industrial sectors in Pune region. Rani, S. Serbian Journal of Management, 6 1 , 85 - Rao, K. A study on shift work and health.
Asian Journal of Management Research, 2 2 , Saeed, K. Examining the relationship between work life balance, job stress and job satisfaction among university teachers A case of University of Gujarat. International Journal of Multidisciplinary Sciences and Engineering, 5 6 , Sarwar, A.The APeX-1 trial has been amended to add a In that case, labour and raw materialare considered as variable input factors.
A few goods like diamonds etc aredownloadd by the rich and wealthy sections of society.
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Land: It includes all natural resources on the earth and below the earth. Managerial economics deals with the principles of microeconomics as applied to managerial decision making. The circularflow of economic activity explains clearly that every day there are a numberof exchanges taking place among the four major sectors mentioned earlier. Seasonal Goods: Goods which are not used during the off-season seasonal goods will also be subject to similar demand behaviour.
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