Lecture Overview:

This chapter is about you the consumer! You will learn why people love to shop at Costco. After you learn the material in this chapter, you will not see your consuming behavior the same way. The theory of consumer behavior will most likely stay with you the rest of your life. It did in my life. It is a fascinating chapter because you will be able to relate to it and apply it.

Be sure to get out your pencil and paper and take notes and do what I do in the lecture when I do calculations to determine Marginal Utility and Consumer Surplus. You will learn the material faster and deeper because you will be learning by doing. It is a much better way of learning than just watching and listening to me. The brain becomes more active when you take notes and do the calculations.

The material in the video is a wonderful preparation for your chapter 7 practice quiz, your chapter 7 testing quiz, and for your midterm.

I also suggest you have your textbook near you so that you can relate the material in the textbook to my video lecture.

The material in this video lecture does go beyond the material in the textbook. You will notice the difference towards the end of the lecture.

Below is a menu that lists the topics and the time they are discussed on the video. Use your horizontal lever while watching the video to move to the topic you wish to review.

Link to Video Lecture:

Watch My Theory of Consumer Behavior Video Lecture

Link to Practice Quiz:

Take the Chapter 7 Practice Quiz

Recording Menu:

This video is about 32 minutes long.

Below is a menu that lists the topics and the time they are discussed on the video. Use your horizontal lever while watching the video to move to the topic you wish to review.

Time: Topic:

0:20 What is Utility?

0:34 Total Utility, Marginal Utility, and The Law of Diminishing Marginal Utility

3:11 Demand Schedule For Hamburgers

4:18 The Law of Diminishing Marginal Utility

5:51 Total Utility Example

6:34 Maximizing Utility When you Buy a Product and When it is for "Free."

9:12 Questions for Discussion: Hamburgers, Fries, and Coke examples

10:23 Limitations of Utility Applications

10:55 Consumer Surplus

14:49 Personal Trainer Exercise Calculating Consumer Surplus

16:54 Using a Graph to Show Consumer Surplus and Producer Surplus

17:51 Do Price Gougers Rip Us Off?

18:22 All You Can Eat Buffets and Negative Marginal Utility

18:37 Utility Maximizing Rule when Buy Two Products

21:26 Utility Maximizing Example: Choosing Apples and Oranges with a Fixed Amount of Money

27:06 Deriving the Demand Curve