Question 11 pts
Managerial economics can best be defined as the:
macroeconomics and microeconomics for managers.
study of economic incentives on consumer behavior and demand.
analysis of the labor market through the behavior of workers and managers.
analysis of major management decisions using economic tools.
study of the strategic interaction between firms in a market.
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Question 21 pts
Which of the following is true of economic models?
Models are too theoretical to be applicable in real world decisions.
Models are not useful because uncertainty prevents accurate forecasts.
Models are simplified descriptions of processes, relationships, or other phenomena.
Models describe real world situations in complete detail.
Models are not useful because they do not take into account complicating and less
important features of a problem.
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A probabilistic model gives a description of real world economic phenomena.
A probabilistic model shows the possibility of a range of outcomes.
A probabilistic model examines the changes in economic variables over a period of time.
A probabilistic model is based on value judgments.
A probabilistic model is used to explain long-run economic phenomena.
maximize short-term profit, even if this sacrifices long-term profit.
maximize the value of the firm.
increase production to the highest possible level.
increase the market share of the firm.
diversify into as many product lines as the firm can.
