The principle of revealed preference would say that if Xavier chooses market basket A over market basket B then:
A) if A is more expensive than B, then Xavier must prefer A over B.
B) if A is more expensive than B, then Xavier must prefer B over A.
C) if A is less expensive than B, then Xavier must prefer A over B.
D) if A is less expensive than B, then Xavier must prefer B over A.

Question

Quizplus · Accepted Answer

The principle of revealed preference suggests that if an individual chooses one option over another, particularly when the chosen option is more expensive, it indicates a stronger preference for the chosen option. Thus, if Xavier chooses market basket A over B, and A is more expensive, it implies he prefers A over B.

The Principle of Revealed Preference Would Say That If Xavier