The Theory of Consumer Choice

question 32

Multiple Choice

The theory of consumer choice:

• A)describes how a consumer chooses between different budget constraints.
• B)describes how a consumer chooses between different income levels.
• C)describes how a consumer allocates her limited income among available goods and services.
• D)describes how a consumer allocates her limited preferences among available income levels.

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Definitions:

Customer Base

The customer base refers to the group of consumers who repeatedly purchase the goods or services of a business.

Bank

A financial institution licensed to receive deposits and make loans, and offer other financial services, such as wealth management and currency exchange.

Float Balance

The amount of money within a financial system that is briefly counted twice due to time gaps in registering a deposit or withdrawal, often seen in the banking system.