What is a wrong statement about the four basic assumptions about individual preferences and the significance...

 

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What is a wrong statement about the four basic assumptions about individual preferences and the significance or meaning of each? 1. O Preferences are complete: this means that the consumer is able to measure and compare all possible baskets of goods and services like our weight and height. 2. O Preferences are transitive: this means that preferences are consistent, in the sense that if bundle A is preferred to bundle B and bundle B is preferred to bundle C, then bundle A is preferred to bundle C. 3. (3) More is preferred to less: this means that all goods are desirable, and that the consumer always prefers to have more of each good. 4. Diminishing marginal rate of substitution: this means that as a consumer moves down along her indifference curve she is willing to give up fewer units of the good on the vertical axis in exchange for one more unit of the good on the horizontal axis. 5. O Diminishing marginal rate of substitution also means that balanced market baskets are generally preferred to baskets that have a lot of one good and very little of the other good. What is a wrong statement about the four basic assumptions about individual preferences and the significance or meaning of each? 1. O Preferences are complete: this means that the consumer is able to measure and compare all possible baskets of goods and services like our weight and height. 2. O Preferences are transitive: this means that preferences are consistent, in the sense that if bundle A is preferred to bundle B and bundle B is preferred to bundle C, then bundle A is preferred to bundle C. 3. (3) More is preferred to less: this means that all goods are desirable, and that the consumer always prefers to have more of each good. 4. Diminishing marginal rate of substitution: this means that as a consumer moves down along her indifference curve she is willing to give up fewer units of the good on the vertical axis in exchange for one more unit of the good on the horizontal axis. 5. O Diminishing marginal rate of substitution also means that balanced market baskets are generally preferred to baskets that have a lot of one good and very little of the other good.

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The detailed answer for the above question is provided below answer 5 Diminishing marginal rate of substitution also means that balanced market baskets are generally preferred to baskets that have a l... View the full answer