Although some tastes do change over time,economists believe that tastes are relatively stable.If tastes were not stable enough,then _____
A)the supply curve of a good could not be drawn.
B)the "other-things-constant" assumption required for demand analysis could not be made.
C)the average cost curve of a firm could not be drawn.
D)consumers could not increase utility by reallocating their budget.
E)the law of diminishing marginal utility would not hold true.

Question

Quizplus · Accepted Answer

The "other-things-constant" assumption required for demand analysis assumes that consumers' tastes and preferences are relatively stable over time. If tastes were not stable enough, this assumption would not hold, and demand analysis would be difficult if not impossible. The other choices are not directly related to the stability of consumer tastes.

Although Some Tastes Do Change Over Time,economists Believe That Tastes