 There are 3 things that you can do right after you get home today:  Read a book  Homework  Take a nap  Next to each one, assign a value from 0-10.

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Presentation transcript:

 There are 3 things that you can do right after you get home today:  Read a book  Homework  Take a nap  Next to each one, assign a value from 0-10 to represent your utility  Sequence these activities from the highest number to the lowest number

1. What is the marginal utility between your first and second choice? 2. What is your opportunity cost?

1. What is the marginal utility between your first and second choice?  Utility of first choice – Utility of second choice = marginal utility 2. What is your opportunity cost?  Your second choice (NOT YOUR THIRD!)