How do economists mathematically model the choices we make every single day?
In short: Professor Jonathan Gruber explains the foundations of consumer decision-making in this lecture from MIT's Principles of Microeconomics course. By examining how we form preferences, he introduces the utility function as a tool to quantify human choice.
This lecture explores the logical framework behind consumer demand. It begins by analyzing the nature of consumer preferences and transitions into the utility function, which serves as a mathematical representation of those preferences.
Understanding these concepts is essential for grasping how economists model individual behavior and market outcomes. This session is part of the Fall 2023 Principles of Microeconomics course at MIT.
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- Summary by Intellect · source: Lec 2: Preferences and Utility Function
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