We assume that the representative consumer's preferences exhibit the properties that
A) they evolve over time and that more is always preferred to less.
B) more is preferred to less and that the consumer prefers diversity.
C) the consumer likes diversity and that more is sometimes preferred to less.
D) more is sometimes preferred to less and that consumption and leisure are both normal goods.
E) less consumption is preferred to more leisure and that consumption and leisure are both normal goods.

Question

Quizplus · Accepted Answer

The representative consumer's preferences typically assume that more is preferred to less (non-satiation) and that the consumer prefers diversity (convexity of preferences).

We Assume That the Representative Consumer's Preferences Exhibit the Properties