In economic utility analysis, consumer tastes and preferences are assumed
A) to be determined by income.
B) to be influenced by the prices of goods.
C) given and stable for an individual.
D) given but rapidly changeable.

Question

Quizplus · Accepted Answer

Consumer tastes and preferences are assumed to be given and stable for an individual in economic utility analysis. This assumption allows for the analysis of how consumers allocate their limited resources in order to maximize their satisfaction or utility. While consumer preferences can change over time, the assumption is that they are relatively stable for the purposes of economic analysis.

In Economic Utility Analysis, Consumer Tastes and Preferences Are Assumed