Rational decision making Flashcards
1
Q
What do consumers aim to do when making economic decisions?
A
Maximise their utility
2
Q
What do firms aim to do when making economic decisions?
A
Maximise profits
3
Q
What do government aim to do when making economic decisions?
A
Maximise social welfare
4
Q
Define marginal analysis
A
The analysis of the benefits and costs of the marginal input of a good or product.
5
Q
What is a consumer’s utility?
A
The total satisfaction received from consuming a good or a service.