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It dealt with the way in which a household could make the best and most efficient use of its limited resources (income) to satisfy its unlimited wants.Later, with the growth and advancement of human civilisation, the concept of efficient financial management of households was carried over to the society and nation as a whole.
Managerial Economics: Managerial economics can be viewed as an economics applied to problem solving at the firm level.
Managerial economics deals with integration of economic theory with business practices for facilitating the decision making planning process by management.
In other words, the society has to decide how to make the best and most efficient use of available resources.
Modern view of economics is not confined only to the allocation of resources but is also concerned with the development of these resources.
Wants and needs of every society are unlimited while the resources available with society to satisfy these wants and needs are limited and these limited resources too have alternative uses.
Therefore, the society has to decide the goods and services to be produced with these resources and also the quantity in which these goods and services should be produced so that maximum possible wants of society may be satisfied.In the early days, the sole objective of business was to earn profit at any cost in order to accumulate wealth, gain economic power even at the cost of social justice.This concept has become almost outdated and the modern concept of business economics believes in the fact that business is a long lasting social and economic institution.Macro-economic examines the aggregates and averages of economic variables which included study of money, banking and financial institutions, general price levels, inflation theory of employment, income distribution, monetary and fiscal policies and problems of economic stabilisation.Science is a systematised body of knowledge which establishes relationship between cause and effects. Use of Economic Laws and Principles: Study of economics involves the use of number of economic laws and principles.The main objective of the business economics is to be in business.The business economics in order to survive and grow has to make profit along with meeting other societal obligations. Thus, along with economic objectives of profit maximisation, social responsibilities of business towards various stakeholders like owners, workers, consumers, society and government have gained a considerable importance.Business includes activities such as farming, mining, manufacturing, banking, trading, insurance, transport, construction and warehouse etc. Concept of Business Economics: Business Economics was attached different meanings in accordance with the objectives set.According to one school of thought, business economics was conceived as an activity aimed at profit maximisation.There are many examples of Applied Economics such as Industrial Economics, Managerial Economics and Agricultural Economics.In descriptive economics actual facts about a particular economic subject for the aim of study.