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DIAMOND-WATER PARADOX: The perplexing observation that water, which is more useful than diamonds, has a lower price. If price is related to utility, how can this occur? This paradox was first proposed by classical economists in the 19th century and was subsequently used as a stepping stone for developing the notion of marginal utility and the role it plays in the demand price of a good. The paradox is magically cleared up with an understanding of marginal utility and total utility. People are willing to pay a higher price for goods with greater marginal utility. As such, water which is plentiful has enormous total utility, but a low price because of a low marginal utility. Diamonds, however, have less total utility because they are less plentiful, but a high price because of a high marginal utility.
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AUTONOMOUS GOVERNMENT PURCHASES Government purchases by the government sector that do not depend on income or production (especially national income or gross domestic product). That is, changes in income do not generate changes in government purchases. Autonomous government purchases are best thought of as government purchases that the government sector undertake independent of income. They are measured by the intercept term of the government purchases line. The alternative to autonomous government purchases is induced government purchases, which do depend on income.
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BEIGE MUNDORTLE
[What's This?]
Today, you are likely to spend a great deal of time calling an endless list of 800 numbers looking to buy either super soft, super cuddly, stuffed animals or a large stuffed brown and white teddy bear. Be on the lookout for spoiled cheese hiding under your bed hatching conspiracies against humanity.
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This isn't me! What am I?
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A scripophilist is one who collects rare stock and bond certificates, usually from extinct companies.
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"Progress always involves risk. You can't steal second base and keep your foot on first. " -- Frederick B. Wilcox
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AFA
Advertising Federation of America
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