According to the utility theory, if bundle A is preferred to B, and bundle B is preferred to C, then A is also preferred to C.Under no circumstances will the individual prefer C to A.Identify this assumption on preference.
A)Completeness
B)Rationality
C)More-is-better
D)Convexity
E)Monotonicity

Question

Quizplus · Accepted Answer

This assumption is known as rationality, which includes the properties of completeness and transitivity in preferences. The scenario described illustrates transitivity: if A is preferred to B and B is preferred to C, then A is preferred to C.

According to the Utility Theory, If Bundle a Is Preferred