Moe's parents frequently tell him how it was back in their childhoods.They had a smaller house,fewer toys,only one car and one black-and-white TV,but they were happy.In fact,Moe's parents claim that they were happier than Moe and his friends are today even though Moe and his friends all have much more stuff.Moe concludes that
A)his parents are irrational,because for rational people total utility increases with consumption.
B)Moe's parents are subject to diminishing marginal utility,but Moe and his friends are not.
C)economic models cannot be applied to two different generations.
D)the social forces that influence demand have changed since Moe's parents were young.

Question

Quizplus · Accepted Answer

The social forces that influence demand have changed since Moe's parents were young. The preferences, values, and societal norms that drive consumption have changed over time. Moe's parents may have derived more happiness from simple things such as spending time with family and friends, while Moe and his friends may derive more happiness from material possessions and gadgets. Economic models may not apply universally, as individual preferences and preferences of different generations impact consumption patterns.

Moe's Parents Frequently Tell Him How It Was Back in Their