Lecture%2010%20February%2023

Lecture%2010%20February%2023 - Todays agenda The rational...

Info iconThis preview shows pages 1–5. Sign up to view the full content.

View Full Document Right Arrow Icon
Today’s agenda The rational consumer’s choices Budget lines and budget sets Preferences and utility Reminder: If your name is listed at the end of any lecture, you must show your Rutgers ID to a teaching assistant before leaving the room .
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Where we’ve been and where we’re headed. .. First phase of the course: Gains from trade Introduction to supply and demand Brief look at efficiency of markets and potential for market failure Second phase: Behind the demand and supply curves Relate them to optimizing behavior by consumers and firms in an equilibrium model Explain the negative slope of demand curves Explain the positive slope of supply curves
Background image of page 2
Goals of the next two classes Explain the “Law of Demand” the inverse relationship between P and Q D Focus on demand of single consumer If individuals’ demands slope downward, so too does market demand, as we saw in Lecture 3 Introduce utility and indifference curves geometric ways to describe preferences useful here and later in welfare economics
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Basic hypotheses of theory of consumer behavior Consumers have tastes or preferences concerning amounts of goods and services they consume. They satisfy these preferences as well as they can, given their limited purchasing power: they optimize.
Background image of page 4
Image of page 5
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 03/08/2011 for the course ECON 220 taught by Professor Cai during the Spring '08 term at Rutgers.

Page1 / 49

Lecture%2010%20February%2023 - Todays agenda The rational...

This preview shows document pages 1 - 5. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online