BUS 207 Lecture Notes - Lecture 1: Positive Statement, Excess Supply, Inferior Good

• School: Simon Fraser University
• Department: Business Administration
• Course: BUS 207
• Professor: Mark Moore

Document Summary

Economics: economics is the study of decision-making in the presence of scarcity. Managerial economics: managerial economics in the application of economic analysis to managerial decision-making. Managers make economic decisions by allocating the scarce resources at their disposal. They must understand the behaviour of consumers, workers, other managers and governments to make good decisions. Manager already has limited resources and employees are already at the firm: marketing manager: must allocate an advertising budget to promote the product most effectively. Of course, the manager has a limited budget: top manager: must coordinate and direct all these activities above. Chief executive officer (ceo): focuses on the bottom line. Is also concerned with how a firm is positioned in a market relative to its rivals. Ceo focuses on maximizing the firm"s profit rather than beating a rival. In an environment of scarcity, managers must focus on the trade-offs that directly or indirectly affect profits. input if it uses less of another input.