We assume that the representative consumer's preferences exhibit the properties that
A)more is always preferred to less and that each consumer has one strictly favourite good.
B)more is always preferred to less and that consumers do not like diversity in his or her consumption bundle.
C)consumption and leisure are both normal goods and that the consumer likes diversity in his or her consumption bundle.
D)they be convex and that more is always preferred to less.
E)each consumer has one strictly preferred good and that consumption and leisure are both normal goods.

Question

Quizplus · Accepted Answer

The representative consumer's preferences typically assume that consumption and leisure are normal goods and that consumers prefer diversity, which implies convex preferences.

We Assume That the Representative Consumer's Preferences Exhibit the Properties