Question

3) Managerial economics A) describes how pay for managers is set. B) ensures managers always make good decisions. C) helps managers make decisions in the face of scarcity. D) explains which products consumers will buy.

Answer 1

The correct answer is letter "C": helps managers make decisions in the face of scarcity.

Step-by-step explanation:

Scarcity is the basic problem of economics by which individuals have unlimited needs but finite resources to fulfill them. Scarcity pushes individuals and organizations to make trade-offs by sacrificing the satisfaction of part of a need so another can be covered.

Under that scenario, managerial economics help executives to make decisions in front of scarcity. It aims to provide managers tools to allocate efficiently those scarce resources (materials, capital, and labor hand typically) the firm may acquire.