The knowledge of Economics helps business leaders make better strategic
decisions, to achieve both short term efficiencies and long term optimal and
sustainable outcomes. A study of Economics provides business leaders with a logical
framework (both qualitative and quantitative) for analysis, and the analytical tools
to optimize desired objectives (maximize consumer satisfaction, maximize output,
maximize profits and /or minimize lost). Specifically, Economics helps business
managers to

1. Allocate Scare Resources Optimally
• Understand and apply the concept of the combination of limited
resources and unlimited wants, and thus the imperative to
economize on the use of resources.
• Understand and apply the concept of opportunity cost in their
resource allocation decisions.
• Understand and apply economic analysis aids in deciding what
products to make, how much to produce, and which
production methods (e.g., labor-intensive vs. capital-intensive)
are most efficient.
• Optimize output and/or minimize cost

2. Ensure Data Driven Decision Making
• Understand and apply the concept of the “time value of money”,
and understand the implication of “Return on Investment”.
• Informed decision making on costs, production, and investment.
• Understand and apply the cost structures to improve efficiency
and identify areas for cost reduction.
• Understand and apply the concepts of output maximization and
cost minimization.
• Understand and utilize break-even and cost-volume-profit
analysis for better strategic planning.

3. Understand Market Dynamics that Impacts Demand and Supply
• Understand and apply the concepts of demand and supply to
understand the basic of price determination.
• Understand and apply the concepts of different market
structures like perfect competition, monopoly, monopolistic
competition, oligopoly and its impact on price and output.
• Understand price determination under different market
structures.
• Understand the extent of control firm has on price of products
it sells, non-price competition and marketing.

4. Forecast Future Demand to Ensure Effective Production and Inventory
Management
• Use different forecasting techniques to predict future demand
to ensure efficient production planning, product marketing,
and inventory management.
• Use economic models and data analysis to forecast consumer
behavior, helping businesses plan better and reduce risks

5. Managing Risk Under Uncertain Condition
• Use risk analysis to help anticipate market shifts and mitigate
risks in volatile environments
• Understand. And apply strategies to assess and mitigate
various risks (market risk, credit risk, etc.), allowing managers
to make rational decisions even with imperfect information.
• Use economic principles to evaluate potential returns on
investment, assess financial risks, and manage capital
effectively for long-term

6. Understand Open-Economy Macroeconomic Factors that influences
Domestic Economic Activities
• Understand the broader macroeconomic concepts of inflation,
unemployment, business cycles and changes in interest rate
that impacts individual level firm and consumers, and design
policies to mitigate their adverse impacts on business decision
making.
• Understand economics structures, exchange rates, balance of
payments, and financial markets of different countries to
assess the impact of each one of them on business decision
making.