Asked by Julianna Velaj on Jun 14, 2024
Verified
The theory of consumer behavior assumes that
A) consumers behave rationally, attempting to maximize their satisfaction.
B) consumers have unlimited money incomes.
C) consumers do not know how much marginal utility they obtain from successive units of various products.
D) marginal utility is constant.
Consumer Behavior
The study of how individuals make decisions to spend their resources on consumption-related items.
Marginal Utility
The boost in satisfaction from the consumption of an additional item of a good or service.
Total Utility
The overall satisfaction or pleasure a consumer derives from consuming a certain quantity of goods or services.
- Familiarize yourself with the theory of maximizing consumer satisfaction.
- Understand the theory of consumer behavior assumptions and their implications.
Verified Answer
AM
Adzimah MahmudJun 18, 2024
Final Answer :
A
Explanation :
The theory of consumer behavior is based on the assumption that consumers act rationally, seeking to maximize their utility or satisfaction from the goods and services they purchase. This involves making decisions on what to buy based on the utility those goods or services provide relative to their cost, rather than having unlimited incomes, being unaware of the marginal utility obtained, or marginal utility remaining constant.
Learning Objectives
- Familiarize yourself with the theory of maximizing consumer satisfaction.
- Understand the theory of consumer behavior assumptions and their implications.
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