Managerial Economics 2 - M anagerial Economics Chapter 2 1)...

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Managerial Economics Chapter 2 1) Respond to the following, “Economic is all about unlimited wants and limited resources?” The two reasons Economics come to be that unlimited wants and limited resources. Individuals have unlimited wants. People generally want greater wealth, more attentive service, large house, more luxurious cars, and additional personal material items. They want more time for leisure activities. In contrast to want, resources are limited. Households face limited incomes that preclude all the purchases and expenditures that household members might like to make. 2) “Individual choice is a function of both preferences and constraints and preferences are the easiest to change?” 3) “Managers can influence behavior by affecting marginal costs and benefits that individuals face in their decision making?” Marginal costs and benefits are the incremental costs and benefits that are associated with making a decision. It is the marginal costs and benefits that are important in
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Managerial Economics 2 - M anagerial Economics Chapter 2 1)...

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