Webthere are two major differences between a budget constraint and a production possibilities frontier. The first is the fact that the budget constraint is a. Webtoday, we're going to continue our discussion of consumer choice. To talk now about what happens when we take that unconstrained choice we. Webexplain opportunity sets and opportunity costs. Evaluate the law of diminishing marginal utility. Explain how marginal analysis and utility influence choices. Webexplain opportunity sets and opportunity costs. Evaluate the law of diminishing marginal utility. Explain how marginal analysis and utility influence choices. Webin economics, a budget constraint refers to all possible combinations of goods that someone can afford, given the prices of goods and the income (or time) we have to. Webin the budget constraint framework, all decisions involve what will happen next: That is, what quantities of goods will you consume, how many hours will you work, or how much. Webcalculate and graph budgets constraints. Explain opportunity sets and opportunity costs. Evaluate the law of diminishing marginal utility. Explain how marginal analysis and utility. Webthis lecture continues the discussion about consumer choice and what happens when budget constraints are introduced. See handout 3 for relevant graphs for this lecture. Webwe could be maximizing utility subject to four budget constraints, or we could be minimizing cost subject to four utility constraints. Either way, the solution lies at the.
