In introducing the opportunity cost of time into the theory of consumer behavior, we find that, all else equal,
A) one should consume less of time-intensive goods.
B) one should consume more of time-intensive goods.
C) the consumer's equilibrium position is not altered.
D) the marginal utility derived from each product must be multiplied by consumption time in determining equilibrium.

Question

Quizplus · Accepted Answer

Introducing the opportunity cost of time means that the consumer must consider the value of their time when making consumption decisions. This means that they should consume less of time-intensive goods because the time spent consuming those goods could be used for other productive activities with a potentially higher value.

In Introducing the Opportunity Cost of Time into the Theory