Which of the Following Statements Captures the Meaning of Transitivity

question 160

Multiple Choice

Which of the following statements captures the meaning of transitivity of preferences?

• A)If A is preferred to B, then B is less preferred than A.
• B)If A is preferred to B, and B is preferred to C, then A is preferred to C.
• C)If A is preferred to B and B is preferred to C, then the preference for A over B is stronger than the preference for B over C.
• D)If A is preferred to C, then there exists B such that A is preferred to B and C is preferred to A.

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Definitions:

Traded

The action of buying, selling, or exchanging goods and services between people, businesses, or countries.

Net Creditor Nation

A country that has more investments abroad than other countries have within its borders, resulting in a positive balance of international investments.

Current Account

A component of a country's balance of payments that includes the trade balance, net primary income, and net secondary income.

European Nations

Countries located in Europe, characterized by diverse cultures, languages, and economies but often interconnected through political and economic unions.