microeconomics The Basics of Supply and Demand参考.ppt

Consumer Behavior CONSUMER PREFERENCES Market Baskets CONSUMER PREFERENCES Some Basic Assumptions about Preferences CONSUMER PREFERENCES Some Basic Assumptions about Preferences CONSUMER PREFERENCES Indifference curves CONSUMER PREFERENCES Indifference curves CONSUMER PREFERENCES Indifference Maps CONSUMER PREFERENCES Indifference Maps CONSUMER PREFERENCES The Marginal Rate of Substitution CONSUMER PREFERENCES Perfect Substitutes and Perfect Complements CONSUMER PREFERENCES Perfect Substitutes and Perfect Complements CONSUMER PREFERENCES CONSUMER PREFERENCES Utility and Utility Functions CONSUMER PREFERENCES Ordinal versus Cardinal Utility BUDGET CONSTRAINTS The Budget Line BUDGET CONSTRAINTS The Budget Line BUDGET CONSTRAINTS The Effects of Changes in Income and Prices BUDGET CONSTRAINTS The Effects of Changes in Income and Prices CONSUMER CHOICE CONSUMER CHOICE CONSUMER CHOICE CONSUMER CHOICE Corner Solutions CONSUMER CHOICE REVEALED PREFERENCE REVEALED PREFERENCE REVEALED PREFERENCE MARGINAL UTILITY AND CONSUMER CHOICE MARGINAL UTILITY AND CONSUMER CHOICE MARGINAL UTILITY AND CONSUMER CHOICE MARGINAL UTILITY AND CONSUMER CHOICE COST-OF-LIVING INDEXES Ideal Cost-of-Living Index COST-OF-LIVING INDEXES Ideal Cost-of-Living Index COST-OF-LIVING INDEXES Ideal Cost-of-Living Index COST-OF-LIVING INDEXES Laspeyres Index COST-OF-LIVING INDEXES If indifference curves U1 and U2 intersect, one of the assumptions of consumer theory is violated. Indifference Curves Cannot Intersect 3.1 Figure 3.4 According to this diagram, the consumer should be indifferent among market baskets A, B, and D. Yet B should be preferred to D because B has more of both goods The magnitude of the slope of an indifference curve measures the consumer’s marginal rate of substitution (MRS) between two goods. The Marginal Rate of Substitution 3.1 Figure 3.5 In this figure, the MRS between clothing (C) and food (F) falls from 6 (between A and B) to 4 (between B and D) to 2 (between D and E) to 1 (between