Asked by Boston Bragg on Jun 05, 2024
Verified
In introducing the opportunity cost of time into the theory of consumer behavior, we find that, all else equal,
A) one should consume less of time-intensive goods.
B) one should consume more of time-intensive goods.
C) the consumer's equilibrium position is not altered.
D) the marginal utility derived from each product must be multiplied by consumption time in determining equilibrium.
Opportunity Cost
Forgoing the chance to gain from other possibilities by selecting one option.
Consumer Behavior
The study of how individuals, groups, and organizations select, purchase, use, and dispose of goods, services, ideas, or experiences to satisfy their needs and desires.
Marginal Utility
The added value or satisfaction experienced upon consuming an additional unit of a good or service.
- Recognize the role of time and opportunity cost in consumer behavior.
Verified Answer
HP
Hannah PicinichJun 08, 2024
Final Answer :
A
Explanation :
When the opportunity cost of time is considered, consumers recognize that time-intensive goods take away from other potential activities. Therefore, they are likely to consume less of these goods to allocate their time more efficiently towards activities with higher perceived value.
Learning Objectives
- Recognize the role of time and opportunity cost in consumer behavior.