ECN 104 Study Guide - Midterm Guide: Marginal Utility, Marginal Cost, Business Cycle
12 Mar 2018
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Document Summary
Economics assumes that human behaviour reflects rational self-interest. Individuals look for and pursue opportunities to increase their utility the pleasure, happiness, or satisfaction obtained from consuming a good or service. They allocate their time, energy, and money to maximize their satisfaction. Because they weigh costs and benefits, their decisions are purposeful or rational, not random or chaotic. Purposeful behaviour - simply means that people make decisions with some desired outcome in mind. Marginal analysis comparisons of marginal benefits and marginal costs. Marginal - extra, additional or a change in. Aggregate - is a collection of specific economic units treated as if they were one unit. Therefore, we might lump together the millions of consumers in the canadian economy and treat them as if they were one huge unit called consumers. Microeconomics - is the part of economics concerned with decision making by individual customers, workers, households, and business firms.
