Question

Which of the following is not an assumption of the decision-making process followed by consumers to maximize utility? rev: 04_09_2018 Multiple Choice
a.The consumer has a limited income.
b.The consumer behaves rationally.
c.The consumer can rank his preferences.
d.The consumer does not consider the prices of the products.

Answer 1

Answer:

The correct answer is d.The consumer does not consider the prices of the products.

Explanation:

The concept is simple. The law of supply says that the entrepreneur is willing to produce more if he can sell more, because his personal ambition for profitability leads him to this point. The law of demand says that the buyer is willing to buy at the price that he considers “fair”, and the lower it is, the more demand he will have, not only for the issue of the sense of balance between cost and benefit, but for the same income distribution: there are more people with less income.