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Micro eco review - Patrick Sowell Micro-economics review...

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Patrick Sowell Micro-economics review Chapter 7 Utility- * Indifference Curve Marginal Utility * Budget Line Total Utility * Income Effect Maximize Utility MU/Price * Substitution Eff. Chapter 8 Producer Explicit Cost * Fix Cost Implicit Cost * Variable Cost Economic Cost * Total Coast S run L Run * Chapter 7 Review Consumer- Utility o Satisfaction Down sloping Graph Total Utility o The Marginal utility you get from each unit plus the other one. o Graph is a half circle Maximum Utility o Obj. Consumer: Max Utility Maximizing utility of last $ spent Equation MU/Price Ex.
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Mu/price= [1.6] More utility per dollar Mu/Price= [1.0] Indifference Curve o Down sloping curves Axes labeling- A & B As you move up you get more satisfaction and more utility As you move down you get less satisfaction and less utility Example: Income= 20$ Pa= 2$ Pb=1$ o
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