Household behaviour and consumer choice
4 important questions on Household behaviour and consumer choice
What is marginal utlility (MU)?
On what does the labor supply decision depend?
- Market wage rates
- Skills they possess
- Time limitation
= As with decisions in output markets, the labor supply decision involves a set of trade-offs
What is the price of Leisure?
- Higher grades + faster learning
- Never study anything twice
- 100% sure, 100% understanding
What is the difference between income and substitution effects?
- Higher interest rate -> it takes less saving today to reach a specific target of savings tomorrow -> save less = INCOME EFFECT
The question on the page originate from the summary of the following study material:
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