5 Basic Principles of Economics

Thinking Like an Economist

Tag: Margins of Adjustment

  • “It’s what you learn after you know it all that counts.”

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    This quote, from a successful basketball coach, reveals an aspect of learning which is poorly understood by people who have spent “too much” time in school. Teachers try to teach as much as possible because, in part, they know that there is so much more to learn. Even so, some students think that what they…

  • Fast Food and Downward-Sloping Demand Curves

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    A pair of recent news articles concerning popular fast-food restaurants noted differences for different brands. First, McDonald’s restaurants are changing tactics because consumers (in the US especially) are feeling stressed by the economy. Second, even if the Canadian economy is also performing poorly, Restaurant Brands International Inc. (RBI, which oversees Tim Hortons, Burger King and…

  • The Margins Principle

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    Economics is about behaviour and behaviour is about decisions. The margins principle is a reminder that most decisions involve concern small variations in a margin of adjustment. This idea is probably the second big lesson taught to students in their first economics course. In classes, this principle is seen in jargon such as “marginal utility”,…