Rational customer Flashcards
1
Q
Individual Consumption Bundle
A
Collection of all goods/services consumed by that individual
2
Q
Marginal Utility
A
Change in total utility generated by 1 additional item of good/service
3
Q
Principle of diminishing marginal utility
A
Each successive unit adds less to total utility than previous one
4
Q
Optimal Consumption Rule
A
MUx / Px = MUy / Py
5
Q
Giffen Goods
A
Violate the law of demand. Price rises and people buy more
