Expectations, Grading, Utility,
Marginal Analysis, Models, PPC
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Listen and follow directions.
Treat everyone in the class with respect.
No hurtful comments.
Do your best to complete every assignment. If
you are not able to, ask the teacher for help.
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Mr. Hinsvark
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Everyone
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Classwork/Homework
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Quizzes
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10%
Mixture of completion and accuracy
30%
Open Note
May or may not be announced
Based on readings and class notes
Tests
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60%
Closed Note
Announced at least two days in advance
Based mainly on class notes, but will include questions from
reading
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Utility
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An economic term referring to the total satisfaction
received from consuming a good or service.
A consumer's utility is hard to measure. However,
we can determine it indirectly with consumer
behavior theories, which assume that consumers will
strive to maximize their utility.
Utility is a concept that was introduced by Daniel
Bernoulli. He believed that for the usual person,
utility increased with wealth but at a decreasing rate.
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Marginal changes involved the addition or
subtraction of one good or service
Marginal decisions; what to do with the next
ton of pollution, the next hour of free time, the
next dollar earned.
Marginal Benefit-The benefit of doing
something on more time (measured in utils or
dollars)
Marginal Cost-The cost of doing something one
more time
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If the marginal benefit exceeds the marginal
cost the activity should continue
Ex: If I am purchasing donuts and the benefit is
higher than the cost I should continue
purchasing donuts
If the marginal benefit is less than marginal
cost then do not continue
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Activity 1.1, 1.3, and 1.7 “Favorite Ways”
Complete Activity 1.1 together
Complete Activities 1.3 and 1.7 in groups
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Simplified representation used to better
understand a real life situation
Economist version of a wind tunnel
Ceretis Paribus (Set-uh-ris Pear-uh-bus)
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All things equal assumption
All other relevant factors remain unchanged. Only
the variable you are studying changes.
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Illustrates the tradeoffs facing an economy that
produces only two goods.
Shows the maximum quantity of one good that
can be produced for each possible quantity of
the other good produced.