 Welcome to the session of introduction to the managerial economics. These are the learning outcome of the session. In the session, we are going to see what is the economics, meaning and definition of the managerial economics, the nature of the managerial economics and scarcity. Before proceeding, let me ask you one question. When the inflation is too high, whether it is bad or the good? You may pause the video, think about the question, write down your answer in your notebook. You may return to the video to see the answer. When the inflation is too high, of course, it is not good for the economy or the individual. The inflation will always reduce the value of the money unless the interest rates are higher than the inflation rates. So, what is the economic? The economics is nothing but a study of how the individual and the societies make their choices which are subject to the constraint. The need to make a choice is generally arises from the scarcity. So, what is the scarcity? From the perspective of the society as a whole, scarcity refers to the limitations placed on the production of goods and the services because the factors of the productions are finite. From the perspective of individual, scarcity refers to the limitations on the consumption of goods and the services because of the limited personal income and the wealth. So, what will be the definition of the economics? We can define the economics as the economic is a study of how the individuals and the society choose to utilize the scarce resources in order to satisfy their virtually unlimited wants. The scarcity describes the condition in which the availability of the resources are insufficient to satisfy the wants and the needs of the individuals. The economics is a study of how the people allocate scarce resources for the production, distribution, consumption and both individually and the collectively. The two major types of the economics are microeconomics which focuses on the behavior of individual consumers and the producers whereas, the macroeconomics which examine overall economies on the regional, national and international scale. The economic is specially concerned with the efficiency in the production and the exchange and use the models and the assumptions to understand how to create the incentives and the policies that will maximize the efficiency. Economics formulate and publishes the numerous economic indicators such as gross domestic product that is called as a GDP and consumer price index which is called as a CPI. So, the let us see how what is the managerial economics? Many firms has used a well established principles of managerial economics in order to improve the profitability. The managerial economics draws an attention on the analysis of the concepts such as cost, demand, profit and competition. It attempts to bridge the gap between the purely analytical problems that attract many economic theorists and a day to day decisions that the management must have to face. It offers a powerful tool and the approaches for the managerial policy making. It will be relevant to present several examples illustrating the problems that the managerial economics can help to solve. These also can explain how the managerial economics is a integral part of the business. Demand, supply, cost, production, market competitions are the important concept in real life business decision. A meaning and definition of the managerial economics. The managerial economics is a discipline that combines the economic theory with the managerial practices. It tries to bridge a gap between the problems of logic that attract economic theorists and problems of policy that plague a practical manager. The subject offers the powerful tools and technique for managerial policy making. An integration of economic theory and the tools for decision science work successfully in optimal decision making in phase of the constraints. The study of the managerial economic enriches the analytical skills and helps in the logical structuring of the problem and it provides the adequate solution to the economic problem. The managerial economic is concerned with the application of economic concept and economical analysis in order to solve the problems of managerial decision. Managerial economic is the use of economic model of thoughts to analyze the business situations. So, what is nature of the managerial economic? A close interrelationship between the management and the economics has led to development of the managerial economic. The management is the guidance, the leadership and the control of the effort of the group of the people towards some common objective. It does tell us about the purpose of function of management, but it tells us the precious little about the nature of the management process. So, the management is the coordination, an activity or ongoing process, a purposeive process and the art of getting things which is done by the other people. On other hand, the economic is in the broadest sense is what the economist do. The economists are primarily engaged in analyzing and providing the answers to the manifestations of the most fundamental problems that is scarcity which is called which is nothing, but the insufficiency of the demand. The scarcity of the resources result from two fundamental factors of the life. The human wants are virtually unlimited and uncontrollable and the economic resources to satisfy these human demands are limited. Thus, we cannot have everything we want and we must make a choices broadly in between the three areas. What to produce, how to produce and for whom to produce. These three choice problems have become the three central problems of the economy as shown in the figure. The science of the economics has developed several aspects and analytical tools to deal with the problems of allocation of the scarce resources among the competitive ends. So, definition of the scarcity, the scarcity refers to the resources are being finite and limited. The scarcity means we have to decide how and what to produce from these limited resources. It means there is a constant opportunity cost involved in the making of the economic decision. The scarcity is one of the fundamental issues in the economy. The managerial economics when viewed in this way may be taken as economics applied to the problem of the choices or the alternatives and the allocation of the scarce resources by the firms. Thus, the managerial economic is a study of allocation of the resources available to a firm or the unit of the management along the activities of that unit. The examples of the scarcity will be what a shortage of the fertile land for the population of to grow the food and another example can be like desertification of the Sahara is causing decline in the land useful for the farming in the sub Saharan African countries. Water scarcity will be what a global warming and a changing weather has caused some part of the world to become a dryer and also the reverse has dried up. This has led to the shortage of the drinking water for the both humans and the animal. The labor shortage means what in the post war period the United Kingdom has experienced with the labor shortages that is the insufficiency of the workers to fill the job. Examples are the bus drivers and more recent year the shortage have been focused on a particular skilled areas such as nursing doctors, engineers and the health care shortages. In any any health care system there are limits on the availability of the supply of the doctors and the hospital beds. This will cause a waiting list for the certain operations. So, these are the references of the session. Thank you.