<P> Almost any business decision can be analyzed with managerial economics techniques, but it is most commonly applied to: </P> <Ul> <Li> Risk analysis--various models are used to quantify risk and asymmetric information and to employ them in decision rules to manage risk . </Li> <Li> Production analysis--microeconomic techniques are used to analyze production efficiency, optimum factor allocation, costs, economies of scale and to estimate the firm's cost function . </Li> <Li> Pricing analysis--microeconomic techniques are used to analyze various pricing decisions including transfer pricing, joint product pricing, price discrimination, price elasticity estimations, and choosing the optimum pricing method . </Li> <Li> Capital budgeting--investment theory is used to examine a firm's capital purchasing decisions . </Li> </Ul> <Li> Risk analysis--various models are used to quantify risk and asymmetric information and to employ them in decision rules to manage risk . </Li> <Li> Production analysis--microeconomic techniques are used to analyze production efficiency, optimum factor allocation, costs, economies of scale and to estimate the firm's cost function . </Li>

Discuss the significance of managerial economics in today's economic era