The Principle of Revealed Preference Would Say That If Xavier

question 17

Multiple Choice

The principle of revealed preference would say that if Xavier chooses market basket A over market basket B then:

• A) if A is more expensive than B, then Xavier must prefer A over B.
• B) if A is more expensive than B, then Xavier must prefer B over A.
• C) if A is less expensive than B, then Xavier must prefer A over B.
• D) if A is less expensive than B, then Xavier must prefer B over A.

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Definitions:

Direct Ownership

A form of business ownership where individuals or entities have complete control over their investments or assets without intermediaries.

Foreign Market

Refers to markets outside the company's home country where it can sell or market its products or services.

Exporting

The process of exporting products or services to a foreign country for the purpose of selling them.

Licensing

An agreement in which a company allows another entity to produce its product in exchange for a predetermined fee.