NIBM – Managerial Economics

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National Institute of Business Management

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Assignments of One Year Executive MBA

                                Semester – IIl         

  1. Students are requested to go through the instructions carefully.
  2. The Assignment is a part of the internal assessment.
  3. Marks will be awarded for each Assignment, which will be added to the total marks. Assignments carry equal marks.
  4. Assignments should submit in your ‘portal’ on/before the ‘completion date’ mentioned.
  5. Case study project is based on the elective subject selected.

      Please submit your case study also in the portal on the ‘completion date’ of second semester assignments.

                                                         Assignments                                            Total Marks :100

Managerial Economics

Question.1.What are the factors which constitute Economic environment of a country? Explain.

Answer:The economic environment in which a business operates has a great influence upon it. In this lesson, you’ll learn about the economic environment in business, including its various factors and importance. A short quiz follows.

Economic Environment Defined

The economic environment consists of external factors in a business’ market and the broader economy that can influence a business. You can divide the economic environment into the microeconomic environment, which affects business decision making – such as individual actions of firms and consumers – and the macroeconomic environment, which affects an entire economy and all of its participants. Many economic factors act

Question.2.Explain the arguments in defense of Profit Maximization Hypothesis?

Answer: Profit maximization is the most important assumption used by economists to formulate various economic theories, such as price and production theories.

According to conventional economists, profit maximization is the only objective of organizations.

Therefore, profit maximization forms the basis of conventional theories. It is regarded as the most reasonable and productive business objective of an organization. Apart from this, profit maximization helps in determining the behavior of business organizations as well as the effect of various economic factors, such as price and output, in different market conditions.

The total profit (Π) of a business organization is calculated by taking the difference between Total Revenue (TR) and Total Cost (TC).

Π = TR – TC

Question.3.Describe the assumptions of cardinal utility approach to Consumer Analysis.

Answer:Cardinal utility analysis is based on the cardinal measurement of utility which assumes that utility is measurable and additive. This theory was developed by neo-classical economists like Marshall, Pigou, Robertson etc. It is expressed as a quantity measured in hypothetical units which called utils. If a consumer imagines that one mango has 8 utils and an apple 4 utils, it implies that the utility of mango is twice than of an apple.

Assumptions Of Cardinal Utility Analysis

Question.4.Explain the techniques of forecasting demands.

Answer:Broadly speaking, there are two approaches to demand forecasting– one is to obtain information about the likely purchase behavior of the buyer through collecting expert’s opinion or by conducting interviews with consumers, the other is to use past experience as a guide through a set of statistical techniques. Both these techniques of demand forecasting rely on varying degrees of judgment. The first method is usually found suitable for short-term forecasting, the latter for long-term forecasting. There are specific techniques which fall under each of these broad methods.

Judgmental Approaches to Forecasting

Question.5.How does technology matter in reducing the cost of production? Explain.

Answer:

Question.6.Describe the characteristics of a perfect competitive market?

Answer:

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