Managerial Economics

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                                                             ASSIGNMENT

Managerial Economics

Guidelines

Practical examples and explanation with graphical representation will carry more weight age.There is no length as such described to answer the questions. The external sources can be used and you can also insert images to make the assignments presentable.Original thought and execution will be duly rewarded and plagiarism in any form will be viewed very seriously.Formatting should be proper with font – Cambria, heading size - 14 andbody size – 12, Line spacing 1.5 lines and font colour black.

Question.1. Short Note on "Inflation"

Answer:Inflation is defined as a sustained increase in the general level of prices for goods and services. It is measured as an annual percentage increase. As inflation rises, every dollar you own buys a smaller percentage of a good or service.

The value of a dollar does not stay constant when there is inflation. The value of a dollar is observed in terms of purchasing power, which is the real, tangible goods that money can buy. When inflation goes up, there is a

Question.2.  Explain the Theory of Firm.

Answer:The theory of the firm is the microeconomic concept founded in neoclassical economics that states that firms (corporations) exist and make decisions in order to maximize profits. Businesses interact with the market to determine pricing and demand and then allocate resources according to models that look to maximize net profits.

The theory of the firm goes along with the theory

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