ECON101 Lecture Notes - Lecture 11: Marginal Utility, Price Floor, Comparative Statics

• School: University of Alberta
• Department: Economics
• Course: ECON101
• Professor: gordon lee

Document Summary

Midterm #1- 25 multiple choice questions, 50 minutes. Course introduction- definitions, micro vs macro, positive vs normative, ppf, opp cost, economic choices, judging economic choices (6 questions) Market- who are the players, institutions, rationality assumptions, circular flow (2questions) supply and demand- change between quantity demanded and demand, equilibrium, comparative statics(8 questions) Supply and demand- with the govt, forces in economy, price floor, ceilings, quotas (4 questions) Elasticities- total revenue rule, calculating, cross price elasticity, income (5 questions) Utility: the satisfaction, happiness or need fulfillment that consumers receive from the goods and services they consume. Marginal utility: the change in utility that results from an incremental change in consumption of a good or service. Marginal utility is the change in utility divided by quantity. The law of diminishing marginal utility- the greater is the amount consumed of a good or service, the smaller is the increase in utility from an incremental increase in the consumption of that good.