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Concept of rationality
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Concept of rationality

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  • 1. Concept of Rationality
      • DEFINITION OF RATIONALITY
            • The word rational derives from Latin word ration which mean , reason , or computation
            • From the economics point of view rationality guide the people to make good choices or decision
  • 2. Rationality picture
  • 3. What makes people happy
    • Taking good decision
    • Maximizing their satisfaction
    • Maximizing the utility and welfare
      • So the people have limited income (limited budget) and they seek to allocate their funds in a way that improve thir standard of living
  • 4. What makes people unhappy
      • Imperfect or incomplete information
        • Imperfect or incomplete information which can lead us to a loss of satisfaction and welfare not only for people themselves but which affect other and our society as a whole
      • Poor choices
        • Making poor choices can also lead us to loss our satisfaction and utility
  • 5. Advertising and marketing
        • Multinational companies have advertising and marketing budgets that often run into hundreds of million of pounds. We are all influenced by their advertising and marketing as result we get loss of satisfaction and utility because of misleading advertising

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