Saturday, August 28, 2010

Marginalism

Note: I will separate each posts into an easy part and a hard part, indicated by a line. 

The easy definition: Minimalism Marginalism analysis is the study where Economists try to see how "just one more" affects things. For example, they'll try to see how watching just one more youtube videos affect things, or how drinking just one more cup of beer will affect you.

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The nerd definition: A direct example of this into economics would be questions such as "Should Palpatine make one more Death Star?" and "Should a business increase its output one more time or not?". Usually, watching more youtube videos or drinking one more cup of beer will make you feel better. However, after a while, things get worse. You get a fraction for not doing homework. And hangovers generally sucks.

Rational thoughts is one of the bog three principles to economics, the other two being Scarcity and Rational Behaviors.

How many cats can you own before you suffocate the house?

None, because houses don't require oxygens. 

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