ECON 103 Chapter Notes - Chapter 3: Procrastination, Marmite, Alarm Clock

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Substitution: everyone is willing to trade some amount of one good for another: everyone has their price, nothing is scared. Social sanctions to substitutions: speeding, driving an unsafe car, custody, bad marital behavior. Alarm clock across the room: sub: more sleep/late for class. Objections to the principle of substitution: not everyone is willing to make the same trade off, they don"t have to. Different tastes": no one will substitute a necessity, needed for existence, principle doesn"t say how much, trade a lot for a little, eg. Sub in diet and exercise: eg. Sub in lower gas consumption, adjust behavior, take the bus, live closer to work, etc: trade off life at the margin (expectation of a lower life for goods) all the time, eg. Driving to fast, smoking, eating fast food: eg. Living wills forgo excessive medical treatment for lower insurance premiums.

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