Which of the following is a TRUE statement about the economic assumption of rationality?
A) Individuals who are rational necessarily ignore the interests of others.
B) Individuals generally act as though they are rational.
C) Individual behavior may be irrational but group behavior is always rational.
D) People make decisions as if they are most selfish in the world.

Question

Quizplus · Accepted Answer

The economic assumption of rationality assumes that individuals generally act as though they are rational, meaning they make decisions based on maximizing their own self-interests. However, this does not necessarily mean that they completely ignore the interests of others or always act in a selfish manner. It also does not imply that group behavior is always rational. There may be situations where group behavior is influenced by individual irrationalities or biases.

Which of the Following Is a TRUE Statement About the Economic