As you, firms big and small, and governments are making your decisions, you all have something in common — none of you are making decisions in isolation. Economists believe everyone is trying to optimize. While you are making your decision optimizing, so is everyone else. Because we exist in a world where everyone is simultaneously optimizing, your decisions influence everyone else and vice versa. One of the core principles is a special situation no one would personally benefit by changing their behavior. In this lesson, Professor Min Sok Lee explores the idea of equilibrium including applications using supply and demand.
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