00:01
There are many terms that are related in this chapter.
00:05
So let's discuss them to see how they are different or similar to each other or how they relate.
00:17
So the first term we'll discuss is incentives.
00:25
What are incentives? it is intuitively what you would think.
00:30
The benefits offered to encourage people to act in a certain way.
01:18
And related to this, let's think, what is utility? the utility is the benefit or satisfaction we gave.
01:32
From using a gooder services.
02:03
So as we can see, incentives and utility both affect the choices people make, but incentives are actual quantifiable benefits like money, praise, recognition, and utility is more for our pleasure or happiness, which is not as concrete, like we could get satisfaction or utility from eating ice cream or seeing a movie, and that's a different type of benefit than you get from getting your salary, which is an incentive to go to work, for example.
03:30
Let's think of a different set of terms now that are also relatable and in this context as well.
03:35
We have tradeoffs, which is, as you would think, the alternative you give up when you make a choice...