MANAGERIAL ECONOMICS: UNDERSTANDING ECONOMIC OPTIMIZATION

Abstract

Abstract, Changes in the business environment will occur at any time, generally in the
form of changes in one or a combination of environmental factors outside the
company, both on a national, regional and global scale. Business uncertainty will
usually increase when the economic cycle is down, for example when we enter the
millennium century, and then become optimistic when the economic cycle increases.
The performance of a company will be greatly influenced by government policies in
the economic, monetary, fiscal, trade and investment sectors. Economic development
in developing countries such as Indonesia is also influenced by the sharpness of the
vision, mission and development strategies carried out by the government regime. In
monitoring the economic turmoil because these factors can directly affect the
realization of the achievement of business plan targets, the quality of business
processes and the achievement of company performance benchmarks in a sustainable
manner. The inflation rate is the most important economic variable that directly
affects the condition of consumer purchasing power and the company's production
cost structure. Meanwhile, the development of interest rates should always be
monitored by the company, considering that this main economic variable is the basis
or barometer for activities that are feasible or not appropriate for a business to run.
Management decisions in today's business world are no longer solely based on
economic considerations. According to the principles of economics, which were later
revealed to the branch of managerial economics, management decisions lead to the
goal of maximizing profits, especially economic profits. Developments show that
business decisions have psychological influences on decision makers, as well as social
influences where business entities and decision makers interact with the environment.
Keywords: managerial economics, economic optimization, Indonesia.