Let me ask, have you ever been to a buffet and thought you would get your money's worth by eating as much as possible, only to ultimately feel sick as you left? In this case, you most likely had poor marginal analysis and, frankly, overall poor knowledge of economics.
As an avid Penn State buffet-goer myself, I've had plenty of opportunity to analyze my experiences. For starters, as anyone who has taken an intro economics class knows, sunk costs are—sunk. There's nothing you can do to get your money back. So when I, or anyone else, swipes their ID card in dining hall, there is a cost incurred that can't be undone.Whether you eat nothing or eat enough to feed an army, you will still have lost that $5.00 that was just swiped away.
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| This meme isn't funny, but it is courtesy of imgflip.com |
Me being the analytical human being that I am, decided I would test yet another economic principle: the law of diminishing marginal utility. After eating my normal dinner in the buffet I decided to conduct the test with cookies. The soft, warm cookies of the Redifer dining halls are always so enticing.
I initially grab two cookies. The first cookie is amazing. Its flavors are an overwhelming ambrosia and, for a brief moment, I feel like I'm floating (I know my foodies can relate). I estimate my total utility (an economic term for pleasure) to be 20 utils (an economic term that quantifies utility). The second cookie is good, but its sweetness is a little much. I gain 15 utils. By the the fifth cookie, I am begging for mercy. The sweet treats are now ravaging my innards. 0 utils. Still, for the purposes of the experiment, I force yet another circle of death down my throat.
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| Graphic representation of my diminishing utility. Utility on Y-axis, cookies on X-axis. |
But this was it. Like some twisted scientist, I had gone too far. Eating the sixth cookie was so painful that it gave me negative utils, a situation so grave that I couldn't graphically represent it.
In review, I can't stress enough the importance of the law of diminishing marginal utility. Whether you're eating cookies at a buffet or consuming any other good, edible or non-edible, there will come a point where consuming just one more unit of that good, will not be an economically smart decision for you.
Even though you may not be interested in economics, knowing some economic rules may help you find your optimal of, say, cookies!
