Explain the maximization assumption that economists make in explaining the behavior of consumers and firms.

THE LOGIC OF MAXIMIZING BEHAVIOR

L E A R N I N G O B J E C T I V E S

1. Explain the maximization assumption that economists make in explaining the behavior of con-
sumers and firms.

2. Explain and illustrate the concepts of marginal benefit and marginal cost and apply them to
understanding the marginal decision rule.