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GOVERNMENT BORROWING: The demand for loans obtained through the financial markets by the government sector to finance government purchases over and above taxes. In terms of the circular flow, this is one of two demands for household saving diverted into financial markets, the other is investment borrowing.
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Lesson 9: Consumer Demand | Unit 3: Marginal Utility
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Page: 15 of 22
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In this unit, you should have learned about:- Marginal utility as the extra satisfaction obtained from consuming more units of a good.
- How marginal utility is identified as the change in total utility due to a change in the quantity.
- The marginal utility schedule as a table relating marginal utility and the quantity consumed.
- How marginal utility decreases with the quantity consumed until it becomes negative.
- The law of diminishing marginal utility which states that marginal utility declines when more of a good is consumed.
- Why the law of diminishing marginal utility results from fulfilling a want or need.
- The potential relation between the law of demand and the law diminishing marginal utility.
- How the diamond-water paradox illustrates the difference between total utility and marginal utility.
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MARGINAL REVENUE, MONOPOLISTIC COMPETITION The change in total revenue resulting from a change in the quantity of output sold. Marginal revenue indicates how much extra revenue a monopolistically competitive firm receives for selling an extra unit of output. It is found by dividing the change in total revenue by the change in the quantity of output. Marginal revenue is the slope of the total revenue curve and is one of two revenue concepts derived from total revenue. The other is average revenue. To maximize profit, a monopolistically competitive firm equates marginal revenue and marginal cost.
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Two and a half gallons of oil are needed to produce one automobile tire.
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"Sometimes when you innovate, you make mistakes. It is best to admit them quickly and get on with improving your other innovations. " -- Steve Jobs, Apple Computer founder
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LIML
Limited Information Maximum Likelihood
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