Countless firms have used the well-established principles of managerial economics to improve their profitability. Managerial economics draws on economic analysis for such concepts as cost, demand, profit and competition. It attempts to bridge the gap between the purely analytical problems that intrigue many economic theorists and the day-to-day decisions that managers must face. It now offers powerful tools and approaches for managerial policy-making. It will be relevant to present here several examples illustrating the problems that managerial economics can help to solve. These also explain how managerial economics is an integral part of business. Demand, supply, cost, production, market, competition, price, etc. are important concepts in real business decisions.