Which one of the following does not explain the basic nature of Business economics ?
Distribution theories like rent, wages and interest along with the theory of profit.
Business (managerial) economics is applied microeconomics: it integrates economic theory with business practice to help managers take decisions and plan ahead (Spencer and Siegelman).
It studies the behaviour of firms both in theory and in practice, as in demand, cost, production and pricing decisions.
It uses the tools of economic analysis to clarify problems, organise and evaluate information and compare alternative courses of action.
Distribution theories of rent, wages, interest and profit explain how national income is shared among factors of production. They belong to general economic theory and are not part of the basic nature of business economics, whose focus is the decision problem of the individual firm.
Hence, Distribution theories like rent, wages and interest along with the theory of profit.
Similar Questions
Match the items of List - I with items of List - II and choose the correct code :
List - I List - II (a) Carroll Model (i) International trade (b) Corlett - Hague Rule (ii) Interest rate (c) Hecksher Ohlin Theorem (iii) Principles of taxation (d) Knut Wick sell’s Theory (iv) Social responsibility of business Codes :
(a) (b) (c) (d)
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