Войдите в систему

Consumer Preferences

The cardinal approach of utility uses an imaginary measure of satisfaction, utils. In the ordinal approach, consumer preferences refer to the ranking a consumer makes between different product bundles or baskets. A market basket is a collection of products a consumer can purchase. Two goods are taken in a basket to explain consumer preferences. For example, a market basket could have coffee and sandwiches.

Assumptions about Consumer Preferences

The following assumptions are made:

  1. Completeness.
  2. Monotonic preferences or more is better.
  3. Transitivity.
  4. As consumers accumulate more of a specific good, their willingness to sacrifice another item to acquire even more of those particular goods decreases.

Completeness

It means that consumers can compare and rank all possible combinations of products, known as baskets. A consumer can definitively state their preference for any two baskets, say A and B. They might prefer basket A over B, B over A, or view them as equally desirable.

Monotonic Preferences or More is Better

It means that consumers prefer more of any good to less. For instance, if a consumer is comparing baskets of goods, under the monotonic preferences assumption, they would always prefer the basket with more quantity.

Теги

Consumer PreferencesCardinal ApproachOrdinal ApproachMarket BasketUtilityCompletenessMonotonic PreferencesTransitivityProduct BundlesRanking Preferences

Из главы 5:

article

Now Playing

5.4 : The Consumer Preferences I

Consumer Behavior

125 Просмотры

article

5.1 : Concept of Utility

Consumer Behavior

210 Просмотры

article

5.2 : Marginal Utility

Consumer Behavior

229 Просмотры

article

5.3 : Relationship between Total Utility and Marginal Utility

Consumer Behavior

427 Просмотры

article

5.5 : The Consumer Preferences II

Consumer Behavior

129 Просмотры

article

5.6 : Indifference Curves

Consumer Behavior

139 Просмотры

article

5.7 : Features of Indifference Curves I

Consumer Behavior

81 Просмотры

article

5.8 : Features of Indifference Curves II

Consumer Behavior

88 Просмотры

article

5.9 : Calculating Marginal Rate of Substitution

Consumer Behavior

311 Просмотры

article

5.10 : Marginal Rate of Substitution

Consumer Behavior

99 Просмотры

article

5.11 : Types of Indifference Curves

Consumer Behavior

156 Просмотры

article

5.12 : Budget Constraint I

Consumer Behavior

55 Просмотры

article

5.13 : Budget Constraint II

Consumer Behavior

36 Просмотры

article

5.14 : Factors Affecting Budget Constraint I

Consumer Behavior

51 Просмотры

article

5.15 : Factors Affecting Budget Constraint II

Consumer Behavior

41 Просмотры

See More

JoVE Logo

Исследования

Образование

О JoVE

Авторские права © 2025 MyJoVE Corporation. Все права защищены