ECON 1110 Lecture Notes - Lecture 6: Weighted Arithmetic Mean, Partial Derivative, Indifference Curve
4 Apr 2016
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They will choose the best alternatives, given what is available, given the constraints. When a microeconomist analyzes a market in isolation, assuming that no effects are taking place in other markets. Focuses on market for one good, and assumes prices and quantities of other goods are fixed. Assumes what goes on in one market does affect prices and quantities in other markets. All markets interact ant affect price/quantity in other markets. Chapter 2: theory of the consumer-preferences and utility. Consumption bundle-combination of quantities of the various goods and services that are available. 2 apples, 3 bananas, 0 cookies can be written as (2, 3, 0) We assume that given a choice between two alternative bundles, the consumer can make a comparison. Idea that if sally likes a more than b, b more than c, then she will like a more than c. Monotonicity-consumer prefers more of each good to less.
