Managerial Economics Lecture Notes

A comprehensive set of flashcards covering key concepts, definitions, and applications in Managerial Economics.

Managerial Economics

The application of economic principles and methodologies to key management decisions within organizations.

Scarcity

The fundamental economic problem of having seemingly unlimited human wants in a world of limited resources.

Opportunity Cost

The loss of potential gain from other alternatives when one alternative is chosen.

Demand Analysis

The study of how consumers respond to changes in prices and how this affects the quantity demanded.

Breakeven Point

The level of output at which total revenues equal total costs, resulting in no profit or loss.

Elasticity of Demand

A measure of how much the quantity demanded of a good responds to a change in the price of that good.

Cobb-Douglas Production Function

A functional form of the production function that describes the relationship between two or more inputs, typically capital and labor, and the output.

Economies of Scale

A cost advantage that arises with increased output of a product.

Monopoly

A market structure characterized by a single seller, selling a unique product with no close substitutes.

Perfect Competition

A market structure where many firms offer a homogeneous product, and no single firm can influence the market price.

Managerial Objectives

Goals set by managers that may include profit maximization, market share growth, and securing long-term survival.

Price Discrimination

The strategy of selling the same product at different prices to different customers, depending on elasticity of demand.

Supply Curve

A graphical representation of the relationship between the price of a good and the quantity supplied.

Marginal Cost

The cost of producing one additional unit of a good.

Average Cost

The total cost of production divided by the number of units produced.

Market Structure

The organizational and other characteristics of a market.

Marketing Mix

The set of actions, or tactics, that a company uses to promote its brand or product in the market.

Risk and Uncertainty

The potential for loss or an outcome that cannot be predicted with certainty.