Microeconomics: focuses on the behavior of individual consumers, households,
Microfoundations: Concepts for Making Consumer Decisions
What is the difference between microeconomics and macroeconomics?
Microeconomics: focuses on the behavior of individual consumers, households, & businesses.
1. Why do some couples choose to have three children while others elect to have none?
2. Why do some families carry life insurance while others do not?
3. Why do some families save to purchase major appliances while others buy them on credit?
Example: Housework tradeoffs - Friends are coming to town for the weekend. Should you take them out to dinner or cook for them at home?
1. Opportunity Cost
So, what are the costs of your time (i.e. time costs)?
Weekly median earnings for in 1st quarter of 2009
Total 20-24 $455
Source: Bureau of Labor Statistics, 1st Quarter Earnings 2009
Always ask: so what?