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Question : Statement 1: The concept of consumer equilibrium assumes that the consumer has perfect information about prices and product attributes.

Statement 2: The consumer's equilibrium is based on rational decision-making and the pursuit of maximum satisfaction.

Option 1: Statement 1 is true, and statement 2 is false.

Option 2: Statement 1 is false, and statement 2 is true.

Option 3: Both statement 1 and statement 2 are true.

Option 4: Both statement 1 and statement 2 are false.


Team Careers360 25th Jan, 2024
Answer (1)
Team Careers360 26th Jan, 2024

Correct Answer: Both statement 1 and statement 2 are true.


Solution : The correct option is (c) Option C: Both statement 1 and statement 2 are true.

Statement 1 is true. In the concept of consumer equilibrium, it is assumed that consumers have perfect information about prices and product attributes. This allows them to make informed decisions based on their preferences and constraints.

Statement 2 is also true. Consumer equilibrium is achieved when a consumer maximizes their utility or satisfaction given their budget constraint. This is done through rational decision-making, where consumers compare prices, product attributes, and their own preferences to make choices that maximize their satisfaction.

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