Consumer Optimization
We live in a world of scarcity. In other words, what we want outweighs what we can attain. Why? Well, we have limited resources - money, options, time, etc. When you’re making choices about what to buy, your budget, the prices of goods and services, and your preferences all act as constraints.
To better illustrate this idea, let’s return to our simple example of pizzas and coffees. Let’s also assume that you like both pizza and coffee and want more of both. If you were to look at a map of your indifference curves for these goods, you’d see that you get the most utility on the indifference curve farthest from the origin. But, since scarcity is our reality, that level of utility is probably not achievable.
Combining your budget constraint with your indifference curves can help you see how to get maximum utility given your resources. Any point at which your budget constraint lies tangent to an indifference curve is an optimal combination of pizzas and coffees. Why is it optimal? Two simple reasons: 1) You can afford it, and 2) it will give you the most happiness (aka utility).
In this video, Arizona State University’s Professor Joana Girante will further explain the concept consumer optimization and how it applies to your everyday life. She’ll also cover why your points of consumer optimization will never intersect, but always lie tangent to, your indifference curves. Finally. Prof. Girante will go over marginal rates of substitution in more detail.
Microeconomics Course: bit.ly/20VablY
Next video: bit.ly/2k1nUOK
Пікірлер: 58
Why are u so underrated when u clearly are the best economics teacher on KZread? I love the way you teach, u speak slowly and u make complex concepts sound easy!
OMG WHAT A TEACHER, shes a living legend!!! ! !
OMG .... what can I say .... extremely talented teacher .... you find your vocation no doubt ....
@shopaddress11
6 жыл бұрын
Thanks! I do love to teach! -- Joana Girante
Few things are better for the world today then these economic concepts being supplied for free on youtube. Its great to see the channel getting into slightly more advanced material! Fingers crossed for a little game theory some day.
😀😀😀Perfect combination of animation and teaching!
@MarginalRevolutionUniversity
4 жыл бұрын
Thank you! -Roman
I am in university second semester and your videos are a life saver.
ooooh! why did it took me this long to finally find you. Honestly you are the best econ instructor i have ever come across so far. Thanks a lot for such classes may you be blessed.
This is a very clear lecture. Abstract ideas expressed by means of graphics and some colourful but not distractive images. The pace, the terminology, and diction the are perfect so that it becomes very useful for those students whose mother tongue is not English.
As much as I like Jacob Clifford's videos, sometimes they're too fast paced for me. MRU is much slower and easier to understand, and their use of animations and diagrams are very helpful!
Very good , Its helpful much the new professor you are extremely very good thank u for making these concepts so easy and Interesting
It's my first time to watch your video but seems more helpful and like your way of teaching so nice so kind
This is extremely helpful. Good explanation
I love this channel!!
Thank you so much..lack words to describe your contribution
thanks, great classes
greatest channel ever!
Wow THANK YOU! 😻
whoever this lady is, pleaaaase collaborate with her for more videos!! she is just toooo good
This is amazing and extremely helpfull
Very good !!!
i love these videos. economics is fun :)
Very good . Its helpfull alot
Mam u are superb 👍and lots of love from India ❤️
I'm hungry after these videos 😋😂
So Cutely Explained 😊😊🤗🤗
Thank you!!
tq mam, i am from India 🌹
Excellent explanation, madam
idk why but she makes me so happy
Excellent learning 👍👍
I wonder how you made the animate demonstration. That's amazing!
the explanation and representation are very eye catching and easy to understand. Can you please tell what applications you are using to edit the graphs please.
I value all of your marginal university videos
I learned in my econ class that MRS = - px/py, but in this video there is no negative sign. Which one is right?
oh no I can't find the next video in this Microeconomics course, did they stop making it?
Wow what a use of animations
I wish my University had such teacher😔
there are so many difficuylt economic concepts that only she can explain
Relative market price of goods is (price of pizza)/(price of coffee), but slope is (change in y)/(over change in x). Pizza is on the x-axis and coffee is on the y-axis. This confuses me.
@shopaddress11
6 жыл бұрын
Hi! If you like to think in those terms, think of this. You'll spend all of your budget, M, on Pizza, where total spending in Pizza is number of Pizzas P times the price of pizza, P_pz, so PxP_pz, and on coffee, where total spending in Coffee is number of Coffees C times the price of coffee, P_c, so M = PxP_pz + CxP_c. When you solve for the number of pizzas, which appears in the y axis, you'll get the slope P_c/P_pz. Hope this helps! -- Joana Girante
This channel is fucking underrated!!!
0:45 skill issue Ive already resolved scarcity problem ive did an entire Phd On It But Im Not Releasing It Until 2030s
nicely explained however solving and drawing for sums is an issue
Kindly make a video on labour market
@MarginalRevolutionUniversity
5 жыл бұрын
Hi, We have videos on the labor market in both our micro and macro courses. Micro being more about how wages are determined and macro being about unemployment, etc. Micro - kzread.info/dash/bejne/eWuVy5eFccjOoco.html Macro - kzread.info/dash/bejne/p4SGs9CKqNayY6g.html You might also Tyler Cowen's take on how to choose a career in a world of globalization and automation: kzread.info/dash/bejne/ZJ-Ds6-kdqiXdZs.html -Roman
This is how economic class should be like
Waaaaooooo…
its normal that wish i have to eat pizza after view this video?
Is... Is that a Pikmin sound?
Lord help my brain
pourquoi c'est jamais les gars ?
first
Exam in 5 days boys, wish me luck
"The more pizza and coffe you have the happier you are" Or fat and miserable... Utility is not hapiness.
@shopaddress11
6 жыл бұрын
So true. I definitely do not recommend such a diet! -- Joana Girante
@Stadtfeldi
3 жыл бұрын
Utility equaling happiness is just how Economists like to view it, in all reality utility more or less means the desire to buy something. But boiling the term down to just "happiness" is less of a mouthful and easier to remember.