Economic and Game Theory
|"Inside every small problem is a large problem struggling to get out."|
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If I purchase one console CD Player unit (A). and have no CDs (B) to play, the CD player has 0 TU and 0 MU. The CD is by economic definition a complementary product. Yet without any CDs to play, the player is unable to offer any utility. Yet as the TU increases with more CD's so does the CD's TU and MU. I have still had one unit of a CD player. If I continue to purchase CDs, yes the TU and MU of CD's not the player will diminish. Yet the rational behavior of an owner of 100 CD's is to what?
Buy another CD player, either portable, or for the car or for the Beach. This is maximizing the utility of the CD library at the benefit of increasing another CD player unit.
Therefore, rather than be satiated by one unit A of a particular item, and purchasing more of A until I am satisfied. The complementary product B increases to the point of diminished satisfaction and as a result I purchase another unit of the original unit A.
This occurs over and over with many types of products, such as computers and software.
My Prof said this can not be, since you only need one player. And MU is based on Qp... Which of course was not my point.