A corner solution to a consumer choice problem suggests that:
A) the consumer is not rational.
B) one product is not purchased at all.
C) both products are preferred, but one at a lower rate than the other.
D) neither product is a normal good.
E) all of the above

Question

Quizplus · Accepted Answer

A corner solution implies that one product is not purchased at all, which may happen if its utility or price is very low, or if the consumer has a very strong preference for the other product. This does not necessarily suggest that the consumer is not rational, that both products are not preferred or that they are not normal goods. Therefore, options A, C, D, and E are not correct.

A Corner Solution to a Consumer Choice Problem Suggests That