Title

(4) How Economists Think and Analyze III: Marginal Analysis

Topic Category

Introduction

Publication Date

2011

Keywords

Economic Methodology, Economic Modeling Procedures, Economic Thinking, Marginalism, Maximizing, Self Interest, Markets and Exchange, Marginal Benefits, Marginal Costs

Abstract

This provides a summary of the general analytic methodology used in economics. It discusses the key assumptions associated with the "economic way of thinking." It discusses scarcity, simplification, maximizing behavior, market exchange and the concept of "marginalism." It introduces the key economic decision rule of balancing marginal benefits against marginal costs.

Run Time

3:50

Primary Discipline

Economics

Skills Delivered

Ability to explain the general economic modeling process. Ability to explain key economics concepts of marginalism, maximizing behavior, and the constraining influence of competition in markets. Ability to explain how there can be mutual gains from exchange in a market transaction.

Rigor Level

2000

Prerequisites

Previous Think and Analyze Videos

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