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Which axiom of choice do Lexicographic preferences fail to satisfy?
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- How does the utility-maximization model help highlight the income and substitution effects of a price change. Provide an example please.What assumptions are necessary for supposing that individual preferences can be inferred and valued from the choices that individuals make?give a reasonDiscuss how the utility-maximization model helps highlight the income and substitution effects of a price change.
- Do you think the model of consumer equilibrium describes how people really make the decisions on what to order to in a restaurant to maximize their utility? Is there a better model to measure consumer choice?If the price of restaurant meals is overall higher in big cities then you might expect young people in those cities to spend more on those meals as a percent of their income than similar people in the suburbs. The answer must then lie with the preferences of those young people with their utility curves. Do you think that people reveal their preferences in part by where they choose to live?Can you explain the Pareto principle
