In business it is essential for owners to consider important factors when mapping out their business objectives. Economics used as a tool to solve coordination problems. They include what and how much product to produce, how to produce their product, and for whom they are producing. In order to effectively answer these questions, economics is used. Colander (2006) describes economics as “the study of how human beings coordinate their wants and desires, given the decision-making mechanisms, social customs, and political realities of the society” (p. 4).
Introduction Managerial decisions are an important component in achieving the objectives of the organization. The success or failure of a business depend upon the decisions made by managers. Today’s increasing complexity in the world of business brought forth greater challenges for both the firm and its managers. The rapid rate of technological and digital advance as well as greater focus product innovation and processes that influence marketing and sales techniques have contributed to the increasing complexity in the business environment. This complex environment together with a global market where input and product prices are continuing to fluctuate and remain volatile.
In such case a powerful administration data framework will foresee the business ecological changes. (II) Comprehend Financial Framework: The various types of monetary frameworks impact the business in various ways. It is basic for an agent and business firm to think about the part of industrialists, communist and blended economy. (III) Comprehend Financial Arrangement: Financial arrangement has its own significance in business environment and it has a critical place in business. The business environment comprehends government strategies, for example, send out import arrangement, value approach; financial strategy, remote trade arrangement, mechanical strategy and so on have much impact on business.
Therefore, to achieve this objective, managers have to make choices in decision-making, which is the process of selecting a course of action from two or more alternatives (Weihrich & Koontz; 1994, 199). A sound decision making requires extensive knowledge of economic theory and the tools of economic analysis, that are directly related in the process of decision-making. Since managerial economics is concerned with such economic theories and tools of analysis, it is very relevant to the managerial decision-making process. According Spencer and Siegelman managerial economics accommodates traditional theoretical concepts to the actual business behavior and conditions by amalgamating tools, techniques, models as well as theories of traditional economics with actual business practices and environment in which a firm operates. According to Edwin Mansfield, “Managerial Economics attempts to bridge the gap between purely analytical problems that intrigue many economic theories and the problems of policies that management must
Heilbroner (1993) explains this ... ... middle of paper ... ...hown to be a fundamental socioeconomic transformation. My paper has shown many aspects of the market society, by using a number of theorists’ concepts. I focused on the characteristics of a market society, as well as why this transformation from traditional society was so significant. I also discussed the changes that have taken place in the workplace and the impact on the workers, which these material conditions became apparent throughout time. Lastly, I explained Weber’s idea of “economic rationality” and the worldview of people in a market society, to show how workers rationalized the work they put into the production and distribution of material goods.
For example, when there are different norms between how individuals from different countries interact, make purchase decisions and negotiation, the costs of doing business rise as people deal and adapt to unfamiliar ways of doing business. Different class structures and social mobility also raise the costs of doing business, because they may increase communication deficiencies, impact corporate culture and even increase labor costs. Variations in ethical norms and values can also lead to differences in attitudes towards work, entrepreneurship, honesty, fairness, and social responsibility. Finally, a country 's education system can have important implications for the costs of business and the ability to find a specialized workforce. Therefore, culture can have implications on different aspects of an international business, from communication and ethics, to labor
1. Why is it important to understand macroeconomics if one is to be successful in global business? First let us review what macroeconomics is, macroeconomics provides businesses, non-governmental agencies (NGO’s), governments, and individuals information regarding short run and long run metrics on the collective outputs that governments, consumers, and firms make in an economy. The foundation of macroeconomics is concerned “with human welfare” (Miles, 2012, p. 12). Macroeconomics is important because it allows the public to understand the economy on a macro(big) level, facilitating and assisting firms and governments in making decisions by providing them tools relating to fiscal policy, consumption, output, general welfare of the economy, and global economic policy.
This essay will critically discuss factors in which a business consider in deciding on a costing system to implement and operate when establishing a costing system. A costing system, by definition: “Costing system is that system in which we calculate different costs with different methods and also monitor cost for reducing wastage and misuse of resources.” (SVtuition.org, 2014) A costing system is made up of different elements which best suits a company’s operations. They have many elements that can be meshed into one system, and go hand in hand with one another. These methods include; Job costing, Process Costing, Absorption costing, Traditional costing and Activity based Costing Costing systems are relevant and useful in practices today because they provide a more efficient way in which managers and CEO’s monitor and influence costs and cash flows of a business. Costing systems therefore, sometimes need to be specialised for various business sectors.
Cost Accounting: Its role and ethical considerations Introduction: Accounting is the process of identifying, measuring, and communicating economic information about an entity for the purpose of making decisions and informed judgements. The major areas of within the accounting are: Financial Accounting, Managerial Accounting/Cost Accounting and Auditing- Public Accounting Managerial accounting is concerned with the use of economic and financial information to plan and control the activities of an entity and to support the management in planning and decision-making process. Cost accounting is the subset of managerial accounting and it helps management in determination and accumulation of product, process or service cost. Role of Cost Accounting: Increased competition and uncertain business conditions have put significant pressure on corporate management to make informed business decisions and maximize their company?s financial performance. In response to this pressure, a range of management accounting tools and techniques has emerged.
It is important to note that forecasters must consider a number of new information, including rapidly changing economic conditions and globalization, when creating business forecasts based on past sales. Globalization and economic slowdown has made businesses subject to a great deal of uncertainty. In this time of rapid change, economies worldwide change rapidly, new markets open up and old ones change, and demand for products is often uncertain. As such, businesses must be flexible and adaptable in the types of methods that they use... ... middle of paper ... ...forecasts. Given the high degree of uncertainty in today's marketplace, qualitative forecasting techniques like the Delphi technique may help Firstlogic to better-forecast future sales.