Day 5 slides - Demand Today's Outline Review HW 1 Select...

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1 Microeconomics Principles January 28, 2008 Demand Today’s Outline Review HW 1 z Select questions and Q’s from you Quick Refresher Marginal Analysis z Marginal Cost vs. Marginal Benefit The Market at Work: DEMAND Mark Calendars : HW #2 will be due MONDAY 2/4 HW #1 Class Median: 80 (out of 100) Questions? Economic Systems Five Fundamental Questions z What (output) z How (input) z For whom (distribution) z When (Now vs. Future) - Progress z Responding to Change? Why do we need economic systems? Circular Flow Resource Market Product Market Businesses Households Understanding the Market : Chapter 3
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2 A New Perspective Marginal Analysis Marginal: z Unit by Unit decisions/choices z incremental, additional unit, last unit, next unit The goal: MB = MC z Marginal benefits (MB) z Marginal costs (MC) Marginal Analysis of Marshmallows Goals: z Prove that we make decisions on a marginal basis z Graph of our marshmallow preferences z What’s that curve telling us? z
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Day 5 slides - Demand Today's Outline Review HW 1 Select...

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