The Strong Axiom of Revealed Preference Requires That If a Consumer

question 41

True/False

The strong axiom of revealed preference requires that if a consumer chooses x when he can afford y and chooses y when he can afford z, then he will not choose z when he can afford x.

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Definitions:

ATC Curve

Average Total Cost Curve; a graph that shows the per-unit cost of production at every level of output.

AVC Curve

Average Variable Cost Curve, it represents the change in variable cost associated with producing more units of a good or service.

Variable Input

An input in the production process that can be altered in the short term to adjust the level of output.

Output

Output is the total amount of goods and services produced by an economy or business over a set period, quantifying productivity and economic activity.