Most People Would Prefer to Drive a Luxury Car That

question 272

Multiple Choice

Most people would prefer to drive a luxury car that has all the options, but more people buy less expensive cars even though they could afford the luxury car because

• A)car buyers are irrational.
• B)the total utility of less expensive cars is greater than that of luxury cars.
• C)the marginal utility per dollar spent on the less expensive car is higher than that spent on luxury cars.
• D)luxury cars cost a lot more than non-luxury cars.

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Definitions:

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