Use of Managerial Economics in Finance.

This article focuses on how financial professionals utilize managerial economics in making decisions to resolve business problems. Managerial economics highlights how financial professionals make decisions regarding resource allocation, strategic, and tactical issues that relate to all types of firms from an economic perspective. Profits and wealth maximization are key factors in managerial economics. Profits are very crucial to a firm's bottom line, and wealth maximization is a long term operational goal. Market structures take into consideration: The number of firms in an industry, the relative size of the firms (industry concentration), demand conditions, ease of entry and exit, and technological and cost conditions.