The possibility of the endless cyclical preference is eliminated by the property of:
A) completeness.
B) more and better.
C) diminishing marginal rate of substitution.
D) transitivity.

Question

Quizplus · Accepted Answer

Transitivity is the property that ensures that preferences are consistent and logical. It means that if a consumer prefers A to B and B to C, then the consumer must also prefer A to C. This eliminates the possibility of endless cyclical preferences. Completeness, more and better, and diminishing marginal rate of substitution are all important properties in economics, but they do not directly address the issue of cyclical preferences.

The Possibility of the Endless Cyclical Preference Is Eliminated by the Property