Rational decision making Flashcards

1
Q

What do consumers aim to do when making economic decisions?

A

Maximise their utility

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2
Q

What do firms aim to do when making economic decisions?

A

Maximise profits

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3
Q

What do government aim to do when making economic decisions?

A

Maximise social welfare

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4
Q

Define marginal analysis

A

The analysis of the benefits and costs of the marginal input of a good or product.

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5
Q

What is a consumer’s utility?

A

The total satisfaction received from consuming a good or a service.

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