The importance of the margin when making choices
Rational consumers decide whether to do a little more or a little less of something. They compare the extra benefit of one more unit against its extra cost — this is thinking at the margin.
Formula
MU > MC → consume more; MU < MC → consume less
Real World
Netflix uses a flat monthly fee so each additional episode has zero marginal cost to the viewer — this is why people binge-watch past the point of genuine enjoyment.
Exam Focus
For 'evaluate' questions, distinguish between total utility (can rise while MU falls) and marginal utility — conflating them loses marks.
Price Elasticity of Demand
PED = % change in quantity demanded ÷ % change in price
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