Mathematically Solving for the Income and Substitution Effect of a Price Change

This video uses a numerical example, involving consumer utility maximization, to find the income and substitution effect of a price change. A graph and table are provided to help in understanding the mathematical details.
At approximately 7:41 in the video, I misspoke: I meant to say that with a normal good, you will buy less of it as income decreases.
A different example is here: • Mathematically Solving...

[@Bethlehem0BC]

Never thought the perfect youtube tutorial could exist. Perfect structure and explanations. Thank you

[@austinaune2589]

Econ 10a ucsb?

[@parkerfrancisgauthier7360]

I remember asking my micro professor for help on IE and SE. His conclusion to me was "you're overthinking it." I probably was, but your video was leagues more helpful. Wish I knew this existed then!

[@dylangranum5838]

online micro with calc just became a lot easier. thank you.

[@elinadas74]

Thank you so much! Clear and concise explaination. Cleared up my doubts completely.

[@cherisejanari8661]

Thank you for that simple and very enlightening explanation.

[@sjaoenvf]

the math of the utility function really helps to understand these effect. Thank you.

[@akankshap8649]

your method of explaining this concept is perfect,it clear my all doubt thanks.

[@Orochimaru500]

I understood everything u have done. But that was because of your pure explanation. Thanks Sir.

[@dinacamalia7256]

Thank you sir for the very clear and simple explanation. Great video sir 😊

[@migueru1464]

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[@ekonomiaklassroom2442]

So nicely explained, thank you so much sir

[@thenozar7603]

Alright alright alright Mr Matthew Mcconaughey, thanks for the great video

[@meloney55]

thank you so much, it was really helpful!!!!

[@shivamkumartiwari6545]

Now I become your new subscriber. You teach very effectively. Thanks

[@EconomicsinManyLessons]

I appreciate that!

[@senthamizhvithagan2023]

I have a doubt.can be the income effect work alone without substitution effect??

[@marcosporras6547]

Thank you so much, professor

[@beomkomap]

Thank you sir! very helpful.

[@teddy6347]

Thanks！It helped a lot！

[@nopchannnuon8776]

Very Good job!

[@mosessilungwe4090]

Suppose that the price of good X increases as is the case in the video. Calling the budget W (the budget is unknown), how would you solve x and y under the new prices as a function of W ( the unknown budget).

[@elvinkarimli7690]

Did you find the answer? )

[@jonasf7498]

big thanks!!!

[@orey643]

this guys goated

[@EconomicsinManyLessons]

Thank you!

[@gracebwakya5493]

Thank you

[@GraysonWheeler-ll9hh]

Thank you!

[@EconomicsinManyLessons]

You are very welcome!

[@simonedisalvatore6832]

thank u very much sir !

[@EconomicsinManyLessons]

You are welcome!

[@mateusmurta9447]

thanks a lot

[@FullShadowGaming]

Lifesaver

[@shafeeinsyed4263]

thank you so much for this video, really explained everything in detail

[@EconomicsinManyLessons]

My pleasure. Thank you for the nice comment.

[@canzonibelle8844]

I don't understand why at 06:05 he plugs 5X into the equation...

[@aymanmasud831]

Because when the price of good x increased to 10, you plug it into the budget constraint equation. from that he got y=5x. And I'm pretty sure we hold utility constant. Thus, set the Utility equal to the initial utility. Hope that helps

[@frankconte9869]

Thank you.

[@EconomicsinManyLessons]

You are welcome!

[@emreyaln7780]

LET HIM COOK!

[@mrsoumikghosh5900]

but this is hicks substituition effect

[@Re-BornFree]

Yes, that's what I've been telling myself all along but for unknown reasons the Hicks method is more understandable than than Slutsky.

[@pearldamptey5390]

Hii

[@BalticDude_DCS]

What a terrible video. First of all your arithmetic is terribly confusing and inefficient, and then you tell us that, "A normal good is something you buy less of as your income goes up" I understand they are opposite when referring to income and substitution effects, but you need to explain that. A dislike from me.