The Assumption That Preferences Are Transitive Requires the Consumer

question 37

Multiple Choice

The assumption that preferences are transitive requires the consumer

• A) to rank any two baskets.
• B) to say that basket C is preferred to basket
• A if basket B is preferred to basket A and basket C is preferred to basket B.
• C) to rank a basket with more units of all goods higher than a basket with fewer units of all goods.
• D) to have a diminishing marginal rate of substitution.

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Definitions:

Multidomestic Firm

A multidomestic firm is a company that operates in multiple countries, tailoring its products, marketing, and operations to each local environment rather than standardizing globally.

Transnational Firm

A company that operates beyond its home country, managing production or delivering services in more than one country.

Multinational Firm

A business which functions across various nations, overseeing the manufacturing or provision of services beyond its original country.

World Trade Organization (WTO)

A permanent institution that sets rules governing trade between its members through panels of trade experts who decide on trade disputes between members and issue binding decisions.