Emerson+B

From an economist's perspective, making choices involves making decisions 'at the margin' - that is, making decisions based on small changes in resources: On the surface, this seems like a strange way of considering the choices made by people and firms. It is rare that someone would consciously ask themselves - 'How will I spend dollar number 24,387?', 'How will I spend dollar number 24,388?'. Treating the problem in this matter does have some distinct advantages: > >
 * Marginal Thinking **
 * How should I spend the next hour?
 * How should I spend the next dollar?
 * Doing so leads to the optimal decisions being made, subject to preferences, resources and informational constraints.
 * It makes the problem less messy from an analytic point of view, as we are not trying to analyze a million decisions at once.
 * While this does not exactly mimic conscious decision making processes, it does provide results similar to the decisions people actually make. That is, people may not think using this method, but the decisions they make are as if they do.

//In a production situation, the average costs will tell you just that, what the average cost is. Marginal costs will tell you how much more producing another unit will cost you. Or, on a more familiar situation at the grocery store: if you look at your average costs, and say you wanted to get 50 items...your average cost will be whatever the average has been historically for 50 items. However, marginal thinking will tell you how much more it will cost to add another 2 items. //