A Reference Point Refers To

question 30

Multiple Choice

A reference point refers to:

• A) a point of equilibrium in the indifference map from which consumers may deviate.
• B) a statement or assumption in basic consumer theory that serves as a starting point of contention in the theory of behavioral economics.
• C) the point from which an individual makes a consumer decision.
• D) the point of utility maximization from which a consumer departs, only to return later to it.

---

Definitions:

Relatedness

The feeling of being connected or related to others, which is essential for fostering social bonds and personal relationships.

Existence Needs

Basic physical and material well-being necessities like food, shelter, and safety that individuals require.

Growth Needs

Psychological requirements that drive personal development, self-improvement, and the fulfillment of one's potential.

ERG Theory

A theory of human motivation developed by Clayton Alderfer that categorizes core needs into three groups: Existence, Relatedness, and Growth.