Consumer theory does not specify which goods people consider economic "goods" and which economic "bads".It nonetheless remains useful because:
A)people are all different.
B)some people don't consider anything an economic "bad."
C)people reveal their preferences through their consumption decisions.
D)consumers have identical preferences.

Question

Quizplus · Accepted Answer

Consumer theory is based on the assumption that individuals make choices based on their preferences. By analyzing their consumption decisions, economists can infer what goods and services are valued most highly by consumers. While it is true that people have different preferences, the usefulness of consumer theory is that it allows economists to understand how individuals prioritize their consumption decisions without having to specify which goods are economic "goods" or "bads."

Consumer Theory Does Not Specify Which Goods People Consider Economic