Consumer Choice
by breanna bischoff
1. Subsitution Effect
1.1. principle of subsitution
1.2. serveral goods
1.3. changes in price
2. Purchasing Power
2.1. changes based on income or price
2.2. income rises = more power
2.3. prices falls = more power
3. Income Effect
3.1. changes in price of goods
4. Behavioral Economics
4.1. limitations
4.1.1. bounded rationality
4.1.1.1. worse off
4.2. analysis
4.3. rationality
4.3.1. people will do what is best
4.3.2. not constant
5. Indifference curves
5.1. combinations
5.1.1. different goods same utility
5.2. shows utility
6. Budget Constaints
6.1. income
6.2. price of all goods
6.3. slope
6.3.1. negative at relative price
6.4. relative price
6.4.1. MRS
7. Utility
7.1. more is better
7.2. marginal utility
7.2.1. diminishing