Consumers want to maximize happiness (Utility) subject to the budget constraint.
I=(PX⋅X)+(PY⋅Y)cap I equals open paren cap P sub cap X center dot cap X close paren plus open paren cap P sub cap Y center dot cap Y close paren : Income : Prices of good : Quantities consumed Utility Maximization Rule
Mathematics allows us to express economic relationships precisely: microeconomics with simple mathematics pdf
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Market equilibrium occurs at the exact price where the quantity demanded equals the quantity supplied ( Consumers want to maximize happiness (Utility) subject to
A monopoly is a single seller facing the entire market demand curve. To sell more units, a monopoly must lower its price, meaning MRcap M cap R is no longer equal to price. For any linear demand curve
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Microeconomics is the study of how individuals, households, and firms make decisions to allocate scarce resources. While introductory courses often rely heavily on graphs, incorporating basic mathematics—such as basic algebra, linear equations, and simple derivatives—provides a much clearer, more precise understanding of economic behavior.
| Quantity | Price | TR | TC | Profit | MR | MC | |----------|-------|----|----|--------|----|----| | 0 | – | 0 | 10 | -10 | – | – | | 1 | 20 | 20 | 18 | 2 | 20 | 8 | | 2 | 18 | 36 | 24 | 12 | 16 | 6 | | 3 | 16 | 48 | 32 | 16 | 12 | 8 | | 4 | 14 | 56 | 42 | 14 | 8 | 10 |