Suppose all individuals in a group have homothetic tastes.Then we can be sure that the group can be treated as a single representative consumer is if the group members also have identical tastes.

Question

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Homothetic tastes mean that the preferences of all individuals in the group are proportional to each other. This allows the group to be treated as a single representative consumer with the same preferences as any one of the individuals in the group. Therefore, we can assume that the group members have identical tastes for the purpose of analysis.

Suppose All Individuals in a Group Have Homothetic Tastes