ECON 103 Study Guide - Midterm Guide: Scale-Invariant Feature Transform, Economic Surplus, Demand Curve
25 Feb 2014
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Document Summary
Economics: is a particular way of thinking about behaviour. Formality, testable, simple and people are fundamentally the same. Assumptions (economic principles): maximization, substitution, demand, cost, etc. Chapter 2: maximization (it works and is a behaviour that survives/always is present) Maximization: all individuals are always motivated by greed. Scarcity: if the price of a good is zero and people want more than is available, that good is scarce. Equilibrium: a situation where no one wants to change behaviour. Substitution: everyone is willing to trade some amount of one good for some amount of another. 1 is willing to do it, not forced consumption 2. Everyone is willing, but not how much, personal taste: relationship between what one is willing to pay and able to pay. Marginal value (mv): the maximum amount of one good an individual is willing to sacrifice to obtain one more unit of another good. Measured in terms of other goods and varies with consumer.
