econ201.consumertheory

econ201.consumertheory - I. II. Individual Preferences and...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
I. Individual Preferences and behavioral postulates A. Economists are concerned with the consequences of the combined actions of individuals. However, the forthcoming behavioral postulates are specific to individual preferences. B. Behavioral preferences 1. People have preferences 2. More is preferred to less 3. People are willing to substitute 4. Marginal values are decreasing II. Valuation: we measure value by what one is willing to give up in order to obtain something. A. What is intrinsic value? Something that is valuable “in itself” or “for its own sake”. Life. B. We will maintain that an object cannot have value beyond what people are willing to pay for the right to control the object. C. Total Value: the total value of a quantity of a good to a consumer is the maximum amount of money that she is willing to pay in order to acquire a good. D. Also…The total value of a good to a consumer is the minimum amount of money she is willing to accept in order to give up the good. 1.
Background image of page 1

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

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 04/05/2008 for the course ECON 201 taught by Professor Wadell during the Winter '08 term at Oregon.

Page1 / 2

econ201.consumertheory - I. II. Individual Preferences and...

This preview shows document pages 1 - 2. Sign up to view the full document.

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