IB Economics — Topic 2.4

Critique of maximizing behaviour of consumers and producers

Limits of rationality and why real-world behaviour may diverge from simple maximizing models.

Sub-topics in Topic 2.4

2.4.1The rational consumer and producer model2.4.2Behavioural economics and biases2.4.3Nudge theory and choice architecture2.4.4Costs and revenue basics2.4.5Economies and diseconomies of scale2.4.6Profit maximisation logic

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