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SECOND RULE OF SUBJECTIVITY: The second of seven basic rules of the economy. It is the notion that market prices are ultimately determined by subjective values and preferences of buyers and resource owners. While regular, everyday consumers are prone to accept the prices "set" by retail stores and other sellers as etched in stone (perhaps along with the Biblical ten commandments), such is not the case. The price of a product depends on two things, demand (especially the demand price that buyers are willing to pay) and supply (especially the supply price that sellers are willing to accept). Both, I repeat both, are subjectively determined. By subjective, I mean they are based on the values, beliefs, tastes, and preferences of people.
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CONSTRAINED UTILITY MAXIMIZATION The process of obtaining the highest possible level of utility from the consumption of goods or services, under given restrictions, when the highest overall level of utility cannot be reached. The notion of constrained utility maximization is a modification of the more general utility maximization assumption. It is based on the recognition that consumers might be restricted from achieving the absolute maximum level of utility. The primary restrictions tend to be the amount of income available relative to price paid. Constrained utility maximization generally does reach the peak of the total utility curve.
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BLACK DISMALAPOD
[What's This?]
Today, you are likely to spend a great deal of time flipping through the yellow pages trying to buy either several magazines on home repairs or a remote controlled sports car with an air spoiler. Be on the lookout for poorly written technical manuals.
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Junk bonds are so called because they have a better than 50% chance of default, carrying a Standard & Poor's rating of CC or lower.
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"A man is not finished when he is defeated. He is finished when he quits. " -- President Richard Nixon
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CBA
Cost Benefit Analysis
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