The 'price elasticity of demand' of a commodity measures how sensitive the quantity demanded is to its price. When the price increases, the quantity demanded falls for almost any good, but some fall more than others. Price elasticity gives the percentage change in quantity demanded when there is a one percent increase in price, everything else remaining constant. For example, if the elasticity is -2, a one percent price increase leads to a two percent fall in quantity demanded.

• While managerial economics involves the application of economic principles to the problems of the firm, economics deals with the body of principles itself.

• While managerial economics is micro-economic, character economics is macro-economic and micro-economic.

• Managerial economics, though subtle, deals only with the firm and has nothing to do with the economic problems. But microeconomics as a branch of economics deals with both the economics of the individual and the economics of the firm.

Growth Maximization

This is equivalent to sales maximization and may include mergers and acquisitions. With this purpose, the firm may be willing to make lower profit levels to increase in size and gain more market share.

Long-run profit maximization

In some cases, firms may sacrifice profits in the short run to boost profits in the long run. For example, by investing heavily in new capacity, firms can make losses in the short run but can generate high profits in the future.

Practical in Approach: Business economics is practical in its approach. It does not involve itself in the theoretical controversies of economics. Yet, it does not background the realities of business decision making by bringing in abstract assumptions. 

General in nature: Business economics, also called normative economics, sets the standards or norms for policymaking. Business economics is descriptive rather than descriptive. In economic theory, we construct 'laws' such as the law of demand and diminishing returns.

Business economics covers most of the problems that a manager or an organization faces. Therefore, the scope of business economics is broad. Since a firm may face internal/operational and external and environmental issues. For example, microeconomics helps with internal or operational issues, while macroeconomics applies to external or environmental issues.

• Classical economics focuses on the objective theories of market tendency and value to move towards equilibrium.

• As a core form of mainstream economics of the 18th and 19th centuries, classical economics served as the basis for many other schools of economic thought, including neoclassical economics.

• Marxism focuses on the labour theory of value and what Marx considered to be labour exploitation by capital.

• Keynesian economics derives from John Maynard Keynes, particularly his book, The General Theory of Employment, Interest and Money (1936), which introduced contemporary macroeconomics as a distinct field.

Economic Prosperity: 

Economic prosperity is the state of flourishing, thriving, good luck about money.

Business Development: 

A subset of business and commerce, business development involves several tasks and processes that are typically aimed at developing and implementing growth opportunities.

Nationalization:

 Nationalization (British English spelling nationalization) takes a private industry or private property into public ownership by a national government or state.

The three primary measures utilized in macroeconomics to evaluate the performance of an economy are real GDP, unemployment and inflation. Real GDP provides a prevalent indicator of output or output in an economy, whereas unemployment measures how labour resources are being fully utilized. Finally, inflation tracks the overall growth in the level of prices in the economy. Each measure is essential for building macroeconomic models to track the economy's short- and long-term health and address important policy questions.

The scope or subject matter of microeconomics deals with:

Commodity pricing

The price of an individual commodity is defined by the market forces of demand and supply. Therefore, microeconomics is affected with demand analysis, i.e. individual consumer behaviour and supply analysis, i.e. individual producer behaviour.

Factor pricing theory

Microeconomics helps to determine the factor prices for land, labour, capital and entrepreneurship as rent, wages, interest and profit, respectively.