Essay Sample on Scope of Managerial Economics

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University of Richmond
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According to Milton Friedman, business has only one responsibility to make profits (as long as it legal and moral rules of the game established by the society) Few trends could so thoroughly undermine the very traditions of our society as the acceptance by corporate officials of a social responsibility other than to make as much money for their stakeholders as possible. Explain why you agree or disagree with this statement.

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In my opinion, Milton Friedman was wrong about corporate social responsibility. Therefore, I do not agree. Milton argues that a corporate like cannot have a responsibility as a person. He specifically points out fraud and deception of customers, suppliers, stakeholders and interested parties. His phrase as long as it stays within the rules of the game narrowly defines the legal terms used in identifying codes and standards. The question that arises is: what if the norms of the game have no codes of conducted put as a law to govern the corporate? Therefore, there are rules that a company has to adhere to realize success. These rules define the market supply and demand while considering the technological advancement. In most cases, these are not documented. Ethical responsibility and laws are different. Hence, the ethical issues would affect a business since they are not defined. Therefore, a company is, therefore, capable of having responsibilities; they must follow the rules beyond those written as law. A consumer, on the other hand, would wish to make a purchase of an item that he or she feels safe, of quality and value, based on the price to pay. Therefore, Milton Friedman fails to incorporate the ethical issues of practice in a business environment based on the ambiguity of the term rules of the game.

What might be the objective of a museum? Or a firm? Do they have the same aim? Why or why not?

Museums exist for the purpose of keeping historical artifacts safely for exhibitions. The objective of a museum is to educate people who come to view what is displayed at this place. Both museums and firms want to maximize the agencys output concerning value for businesses and knowledge for museums. The purpose of a museum is, therefore, neither for maximizing profits nor based on the sale of particular items, be it goods or services. Conversely, the objective of a firm is the maximization of benefits since the major role is to transform raw material and or services into sales or products (Rios, McConnell & Brue, 2013). Value, on the other hand, is significant for both firms and museums for them to get the maximum value out of their avenues of operation. Firms have stakeholders who entrust investors with their money while the archives hold its value regarding material possession and artifacts.

Whats the difference between unethical and unlawful behavior? Please provide examples of both practices in your discussion

Business ethics refers to the codes or guidelines that describe acceptable business transactions and behavior (Shaw, 2015). Behavior, in this case, may be perceived as ethical to one person and unethical to the other person. To define the behavior that can be termed as ethical or unethical, laws are set aside to determine the conducts of people by a government or a business institution (Shaw, 2015). Ethics and law are related. Law can be defined by as a set of universal and consistent rules applied and accepted by society. Ethics is the standard measure of what is right or wrong in the society. It subsequently establishes the nature of duties people owes themselves or to others. Ethical behavior, therefore, tends to be ideal and good for business, and it involves the demonstration of fundamental moral principles including equality, honesty, fairness, diversity and individual rights (Shaw, 2015). In business, ethics includes management of risks regardless of the particular standards and or beliefs. Unethical behavior, on the other hand, refers to the conducting business transactions or practices in a manner that is not morally right based on the set codes and standards of the society or the enterprises such as lacking moral principles. Examples of unethical behaviors include misusing company time (this includes coming to work late or leaving early, abusive behavior, employee theft and lying to employees (Shaw, 2015).

In your opinion, how much time should a consumer spend on shopping (searching for lower prices (you may want to apply the marginal analysis)

Marginal analysis is a valuable tool in making decisions. This analysis allows buyer or owner to understand whether an activity is profitable and thus make decisions based on that information (Rios, McConnell & Brue, 2013). When making a decision, then the consumer has to understand how profitability changes with and how variables used in the production process can be analyzed. The continual increase in the in variable input would lead to an increased marginal cost either greater or equal to the marginal benefit. On the part of a consumer, the consumer should consider marginal utility analysis. The customer needs to understand the satisfaction from which he or she derives from consuming a commodity. Through the concepts of marginal utility and analysis allows a client to use the minimal amount of time when conducting his or her purchases.

ReferencesRios, M. C., McConnell, C. R., & Brue, S. L. (2013). Economics: Principles, problems, and policies. McGraw-Hill.

Shaw, W. H., & Barry, V. (2015). Moral issues in business. Cengage Learning.

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