In utility analysis, a consumer's tastes and preferences are assumed to be
A) dependent on income and education.
B) predetermined and constant.
C) dependent on national origin.
D) non-existent

Question

Quizplus · Accepted Answer

Utility analysis assumes that a consumer's tastes and preferences are predetermined and constant. This means that each individual has their own unique set of preferences and tastes that remain relatively stable over time. While income and education may influence purchasing decisions, they are not the primary determinant of preferences. National origin may play a role in tastes and preferences, but it is not a defining factor in utility analysis. The assumption of non-existent preferences would contradict the entire premise of utility analysis.

In Utility Analysis, a Consumer's Tastes and Preferences Are Assumed