Friday, July 20, 2018

THE THINKING OF RATIONAL PEOPLE AT THE MARGIN

As per economics it is assumed that people are rational.They can do their best to achieve their objectives.They find the availability of opportunities to sell and to maximize the profit,how many workers,employee to hire and how much of their product to manufacture to achieve the highest possible level of satisfaction.
An existing plan of action to describe a small incremental adjustment is termed as marginal change.
just for example:Today's Indian railway  has implemented a facility,If i have booked a ticket for my journey from Bangalore to Patna in sleeper though it's a long journey to travel but my ticket is not confirmed in sleeper class so before the charting of passenger seat railway has found that there are 10 seats left in AC3 tier for booking.it means train will leave the station with sort of 10 seats.so now what they are doing they are accommodating those sleeper class people whose ticket is  not confirmed and they shift those passenger to AC3 tier to get the margin without increasing in fares.
Now what we have observed if that 10 seats fares are filled with same cost at some margin.Here Indian railway has a rational thinking at the margin.

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