Managed hosting is that type of hosting where you are given a full entire server like a dedicated server but along with maintenance service and technical support. You don't have to maintain your own server. The host does it for you. The difference between managed and dedicated hosting is in the fact that where in dedicated hosting, no maintenance service is available and you need to manage your own server, here in managed hosting all administrative and maintenance duties are carried out by your provider. Although there are clients who want control over their server, inexperience or inability to deal with complicated technical issues may become a hindrance.
All the same, the customer may be needing a dedicated server instead of wanting to share. This is when they should go in for Managed hosting. It is perfect for individuals who don't have the technical know how to manage their own server or organizations that don't have the time or capital to invest in server administration. Unmanaged servers are better handled by individuals and companies who are experts in maintenance and administration of their own servers and have the required number of hours and required resources to maintain them.
The point here is because of the additional support that comes with it, it costs more than a dedicated server. It is expensive but then more reassuring. It is always best that when you start of, you start with a managed hosting service first. Once you get used to management of servers and gain some amount of technical expertise, you can always downgrade to an unmanaged service, saving some money later on.