What is business economics? Discuss Scope of business

Business Economics

  • Business economics is a branch of economics that deals with issues like business firms, management, expansion, and strategy.
  • The primary focus of business economics is a business enterprise or a firm.
  • Business enterprises are units of production of goods and services whose primary objective is to produce for the market in order to earn profits.

                                          

              The scope of business economics

      1. Market demand and supply: The study of market demand and supply help the procedure to determine the price of goods and services, so it's a very important area of study in business economics. 
      2. Production Analysis: It analysis the production process. A business organization tries to make optimum use of available resources to maximize production( Output) and minimize the cost. 
      3. Cost and profit analysis: The cost function is used to make a decision regarding the optimum utilization of resources. Business economics used concepts of opportunity cost and implicit cost to determine economic profits.
      4. Market Structure: The study of market structure is a very important part of business economics. It studies market structures like Perfect Competition, monopoly, Monopolistic competition, etc. 
      5. Pricing: Pricing is one of the most important business decisions that determine a firm’s revenue (income) and profit. 
      6. The objective of the firm: The main objective of every business organization to earn maximum profits. And secondary objective to satisfaction level and maximize sales.
                        
                               
                         
                   Edited by: Imaduddin Khan (BMS, MA in Business Economics,M.Com)
                  Reference: Manan Prakashan


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