Reference no: EM13920321

If we are economists we want to look at marginal benefits and marginal costs to help us to see why consumers buy what they buy . When people make decisions they look at the additional cost and benefit of the decision. The cost or benefit of that decision is called the marginal cost or the marginal benefit. If consumers are making rational decisions and if two products are of equal benefit to a consumer, then he or she will choose the cheaper product. However, if two products are the same price, the consumer will choose the one that provides the higher benefit. People who have a certain incomes will also have to make a choose based on how much money they have.