The term business economics is a school of study under the applied economics branch of economics. It uses the theories of economics and the other empirical analytical tools to monitor the role and the relevance of organizational structure in the optimal use of the scare factors of production viz. land, labor, capital etc. The study of business economics encompasses the study of relevance of organizational structure, the inter-relation between the employee and the firm, the micro and the macro environmental conditions that have impact on business decisions. The term business economics is used synonymous with the concept of managerial economics and industrial economics. However the is some distinction given by some in the economic world that says that managerial economics deals with narrower concepts as compared to business economics. Also the term industrial economics also uses the term narrower covering only the industry as the unit of study and the term business economics covers the study of the service sector as well.
Business economics is a subdivision of economics which particularly manages the business related ideas of economics. A management student ought to have great comprehension of economics so as to take business judgement. The Business economics disguise each one of those parts of the economics which are basic to comprehend for a management students. It empowers student to systematically break down the business atmosphere since majority of the business decisions are taken with regards to winning business condition. Business economics also deals with the hindrances and the ways of overcoming these hindrances in financial approach to founding and running business enterprises. This study also observes the reasons why organizations may prosper and emerge better than others in the competition.
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