John Is Evaluating Four Brands of 3-D Televisions and Has

question 8

Multiple Choice

John is evaluating four brands of 3-D televisions and has decided that picture quality is the most important attribute. All of the alternatives exceed his minimum cutoff for this attribute, so he next compares them on price. One option did not meet his acceptable price cutoff because the price was too high and was eliminated from further review. Next, he looked at the number of HDMI inputs and eliminated another alternative because it did have the minimum number of inputs. He continued in this manner until only one alternative was left and that's the one he decided to purchase. Which decision rule was John using?

• A) conjunctive rule
• B) disjunctive rule
• C) compensatory rule
• D) hierarchical rule
• E) EBA rule

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Definitions:

Economic Stabilization

Actions by governments or central banks to maintain economic growth, control inflation, and reduce unemployment.

Keynesian Economics

An economic theory that advocates for active government intervention in the marketplace and monetary policy to stabilize economic fluctuations and boost demand.

Monetary Rule

A principle or guideline used by central banks to determine the amount of money supply growth necessary to influence interest rates and control inflation.

Price Stability

A situation in which prices in the economy do not change significantly in the short term and low inflation rates are maintained.