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Line 1: − − Fourth Lecture – Theory of Demand − − Instructor, Andy Schlafly − − ==Introduction== Line 25:
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Line 122: − ===Introductory===+ − − ===Intermediary===
example: NBA draft
{{Economics_Lectures}}
{{Economics_Lectures}}
In this course we have covered the supply and demand curves, and examined the economic concept of “elasticity”. Now we turn to focus solely on “demand”.
In this course we have covered the supply and demand curves, and examined the economic concept of “elasticity”. Now we turn to focus solely on “demand”.
By comparing a change in price of a good to the change in the CPI, you can tell whether the real price of the good is becoming more or less expensive. If the good’s price increases by less than the CPI’s increase, then the good has a real price that is falling.
By comparing a change in price of a good to the change in the CPI, you can tell whether the real price of the good is becoming more or less expensive. If the good’s price increases by less than the CPI’s increase, then the good has a real price that is falling.
== Review Example: the NBA Draft ==
<discuss supply and demand for NBA draft, using Michael Jordan example>
==Income and Substitution Effects==
==Income and Substitution Effects==
Read and, if necessary, reread the above lecture. Complete the homework assignments through the level in which you choose to enroll in this course:
Read and, if necessary, reread the above lecture. Complete the homework assignments through the level in which you choose to enroll in this course:
<ask question about sports' draft>
1. The total utility of a good represents the consumer’s _________________.
1. The total utility of a good represents the consumer’s _________________.
2. Conservatives say a bad effect of raising the minimum wage is that it causes more students to drop out of school. Why would that happen?
2. Conservatives say a bad effect of raising the minimum wage is that it causes more students to drop out of school. Why would that happen?
3. A student likes swimming and playing the violin. The first hour she swims she improves by 6 units of utility, and then each successive hour she improves by half the rate of the hour before it. The first hour she practices the violin she improves by 4 units of utility, then each successive hour she improves at a rate of 90% the hour before it. In 3 total hours to practice, how should she maximize her utility?
3. A student likes swimming and playing the violin. The first hour she swims she improves by 6 units of utility, and then each successive hour she improves by half the rate of the hour before it. The first hour she practices the violin she improves by 4 units of utility, then each successive hour she improves at a rate of 90% the hour before it. In 3 total hours to practice, how should she maximize her utility?