The basic concept of marginal utility, how to understand marginal utility

Political economy has existed as an independent discipline for more than 200 years, but people's understanding of it has always been divided. The reason for this is that the academic community has not clearly understood the basic concept of "value". The value of philosophy and the value of economics are two very different concepts.

The value of economics is measured in money, and money is the measure of value. The value of philosophy is subjective evaluation and has nothing to do with money.

In the process of studying political economy, the "labor theory of value", "utility theory of value" and "marginal utility theory" confuse the value of economics with the value of philosophy, which is far-fetched and self-deceptive, and leads the study of political economy astray. Therefore, we must clarify the relationship between labor, utility, margin, and value, and get to the root of the problem.

In fact, labor determines the value of the product's output (output), not the value of the product (**). That is, the more labor invested, the more output value of the product; The more labor put in, the higher the value of the product. The value of the product is determined by the cost, and the cost is composed of the value of the five factors of production (labor, technology, resources, capital, and system), and the value of these five factors of production together determines the value of the product, and the value of labor is only one of them.

Wang's Political Economy redefines some basic concepts and makes major breakthroughs on many key issues. He founded the "Social Productivity Theory", which laid a solid theoretical foundation for the in-depth study of political economy. The "law of value identity" was discovered, that is, the value of production factors is equal to the value of products, which fundamentally solved the logical problem of formation and change.

Through qualitative analysis, quantitative analysis and causal analysis, the essence and law of political and economic activities are revealed.

In microeconomics, marginal utility, also translated as marginal effect, refers to the utility of increasing (or decreasing) the revenue of goods or services for each new unit of goods or services, that is, the slope of the "utility quantity of goods or services" graph.

Economics generally believes that as the volume of goods or services increases, the marginal utility will gradually decrease, which is called the law of diminishing marginal effects.

It should be noted here that marginal utility refers to the degree of satisfaction that increases by one unit of consumption of a certain good, and is aimed at consumers; Marginal returns, on the other hand, correspond to producers. Similarly, as the volume of goods or services increases, the marginal reward will gradually decrease, which is known as the law of diminishing marginal returns.

Assumptions of Cardinal Utility Theory:

1. The amount of utility can be measured specifically.

2. The law of diminishing marginal utility (MU).

The concept of marginal utility is introduced as follows:

Marginal utility refers to the explicit call of utility that can be measured in the sense of a cardinal amount like an individual's weight or height, and it implies that the difference between utilities, i.e., marginal utility perturbation, is meaningful.

Marginal utility is a concept commonly used in Western economics in the 19th and early 20th centuries. The basic idea is that utility can be measured and summed together, and the unit of measurement that represents the size of utility is called a utility unit.

Therefore, the magnitude of the utility can be excited by the base number of ......just as the unit of length can be expressed in meters. Marginal utility theory uses marginal utility analysis, which holds that the utility magnitude can be measured, and its counting unit is the utility unit.

<> "Marginal Utility: Daily Financial Knowledge."

For example, Orange worked out for 1 hour today, sweating profusely, and didn't drink water during the period, but he was too thirsty and thirsty. Finally, Apple brought a box of water to Juzaoko.

When I drank the first bottle of oranges, I was dry in one breath, and I felt so refreshed. The apple says you drink another bottle, and the orange begins to taste, gulping in, and after drinking the second bottle, it feels like it is enough.

The apple said, you drink another bottle, the orange is embarrassed, take a small sip, and feel very strong.

Apple said, you drink another bottle. The orange swallowed it.

Apple said, you drink another bottle. Orange spit out.

Utility is the satisfaction of oranges, and the marginal utility is that every little more, the new satisfaction of oranges is a little less than the last time, and the more you go to the back, there will even be negative satisfaction. "When you enter the room of Zhilan, you don't smell its fragrance for a long time", "Shengmien, fight Mi hatred", people and people are the same.

Marginal utility] refers to the increment of utility added by continuously increasing a certain input when other inputs are fixed.

When the increase exceeds a certain level, the output per unit of input added decreases.

Utilizing Marginal Utility:

1.In love, you must know that both you and others will have diminishing marginal utility, manage yourself well, do not demand from others, and keep it fresh.

2.Learn to use the insatiable greed of "liking the new and hating the old".'。

Marginal Utility] When we yearn for something, the more we are emotionally invested, the stronger the emotional experience will be when we first come into contact with this thing, but the second time we are in contact, we will be lighter, and the third time we will be lighter. In this way, the more we come into contact with the object, the more indifferent our emotional experience becomes, and the more boring it becomes. "The more times a person gets the same reward repeatedly in the near future, the less valuable that additional part of that reward is to him. "

Sunday, December 2, 2018 Fine.

Many people may have heard the story of "Seven Steamed Buns".

When you're hungry, you eat the first steamed bun and you'll feel very, very satisfied, and then you'll eat the second one, and you'll probably feel very good.

III. In the fourth or fifth, the extra satisfaction that steamed buns bring to you is only a smile, and it is greatly reduced.

By the seventh, the steamed bun can no longer bring you any satisfaction. If you are asked to eat ten steamed buns, it is likely to be eaten to the end, that is, the satisfaction is negative.

Although the production cost of these ten steamed buns is the same, the satisfaction they bring to consumers is completely different.

People's desire for objects will decrease with the continuous satisfaction of desires. If the number of items is infinite, the desire can be completely satisfied, and the intensity of the desire will decrease to zero or even negative.

The extra satisfaction that the last steamed bun can bring you is the marginal utility.

Application: Scenario.

Free refill: In many cafes, a cup of coffee costs tens of yuan, and the cup is refilled for free. It seems that he is very angry, and the guests also feel that it is very valuable. In fact, the vast majority of people can only drink 2 to 3 cups, because they are tired of drinking and can no longer drink.

The same method is also used in restaurants for 2 yuan for 1 person, or for hot pot restaurants for 5 yuan for 1 person, unlimited**.