Contrast the Rational and the Normative Models of Decision Making

question 49

Essay

Contrast the rational and the normative models of decision making. What are the assumptions of each?

---

Definitions:

Demand Schedule

A table or graph that shows the quantity of a good or service that consumers are willing and able to purchase at various prices.

Variable Conversion Cost

Costs that vary with the level of production and are associated with converting raw materials into finished goods, excluding fixed costs.

Direct Material

Raw materials that can be directly traced to the production of a specific product and are a part of its finished composition.