According to the rational choice model developed in the text, which statement below is false?
a. people would be less happy if they exchanged money rather than things at Christmas
b. Individual preference patterns do not change because prices change
c. consumers behave as if they did cost-benefit analysis on every purchase
d. cash grants are always better than in-kind gifts
e. none of the above
Ans: a. people would be less happy if they exchanged money rather than things at Christmas
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Barter can best be defined as:
a. the direct exchange of one good for money. b. the direct exchange of money for a good. c. the direct exchange of goods and services without the use of money. d. the direct exchange of labor services for wages. e. the payment of interest on a savings account.
Marginal analysis is useful in economics, but not in other areas of life
a. True b. False Indicate whether the statement is true or false