Explain how marginal analysis and utility influence choices.

Webtoday, we're going to continue our discussion of consumer choice.

Webwe could be maximizing utility subject to four budget constraints, or we could be minimizing cost subject to four utility constraints.

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Explain how marginal analysis and utility.

Explain opportunity sets and opportunity costs.

Either way, the solution lies at the.

Webin economics, a budget constraint refers to all possible combinations of goods that someone can afford, given the prices of goods and the income (or time) we have to.

Explain how marginal analysis and utility influence choices.

Evaluate the law of diminishing marginal utility.

Evaluate the law of diminishing marginal utility.

Webin the budget constraint framework, all decisions involve what will happen next:

Webexplain opportunity sets and opportunity costs.

See handout 3 for relevant graphs for this lecture.

Webcalculate and graph budgets constraints.

The first is the fact that the budget constraint is a.

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That is, what quantities of goods will you consume, how many hours will you work, or how much.

Evaluate the law of diminishing marginal utility.

Webthis lecture continues the discussion about consumer choice and what happens when budget constraints are introduced.

Webthere are two major differences between a budget constraint and a production possibilities frontier.

Webexplain opportunity sets and opportunity costs.

To talk now about what happens when we take that unconstrained choice we.