ignore them and make decisions based on what will happen in the future.

From a Model with Two Goods to One of Many Goods

The budget constraint diagram containing just two goods, like most models used in this book, is not realistic.

After all, in a modern economy people choose from thousands of goods. However, thinking about a model with

many goods is a straightforward extension of what we discussed here. Instead of drawing just one budget

constraint, showing the tradeoff between two goods, you can draw multiple budget constraints, showing the
possible tradeoffs between many different pairs of goods. In more advanced classes in economics, you would

use mathematical equations that include many possible goods and services that can be purchased, together

with their quantities and prices, and show how the total spending on all goods and services is limited to the

overall budget available. The graph with two goods that we presented here clearly illustrates that every choice
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