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Intermediate Macro Economics > Managerial Economics > Flashcards

Flashcards in Managerial Economics Deck (24):
1

Managerial Economics Definition

Science to explain how resources can be allocated in an efficient manner

2

Science to explain how resources can be allocated in an efficient manner

Managerial Economics Definition

3

Elements of Economic Decision

1.) Define decision to be made
2.) Outline Available choices
3.) Define a measurable objective
4.) Input Variables in respect
5.) Relationships between variables interpret.

4

1.) Define decision to be made
2.) Outline Available choices
3.) Define a measurable objective
4.) Input Variables in respect
5.) Relationships between variables interpret.

Elements of Economic Decision

5

Price Elasticity

change of demand due to a change of price

6

change of demand due to a change of price

Price Elasticity

7

elastic demand

lose customers after price increases

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lose customers after price increases

elastic demand

9

inelastic demand

customers remain loyal after a price increases

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customers remain loyal after a price increases

inelastic demand

11

Shift OF demand curve

change of volume sold even if price does not change

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change of volume sold even if price does not change

Shift OF demand curve

13

Shift ON demand curve

change of volume sold due to change of price

14

change of volume sold due to change of price

Shift ON demand curve

15

Law of Diminishing Return

every additional unit of input generates less return from previous unit

16

every additional unit of input generates less return from previous unit

Law of Diminishing Return

17

Economies of Scale

The more you produce (scale) the lower the average cost per product

18

The more you produce (scale) the lower the average cost per product

Economies of Scale

19

Profit Maximization

Analysis of demand curve and variable costs and optimizing to set price

20

Analysis of demand curve and variable costs and optimizing to set price

Profit Maximization

21

Price Discrimination

willing to pay more or less in discretion of the buyer

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willing to pay more or less in discretion of the buyer

Price Discrimination

23

Game Theory

The moves and countermoves between two parties who try to optimize their own results

24

The moves and countermoves between two parties who try to optimize their own results

Game Theory