Chapter 7 Consumer Behavior.docx - Chapter 7 Consumer Behavior 1 Utility A measure of the amount of satisfaction a person derives from something

Chapter 7 Consumer Behavior.docx - Chapter 7 Consumer...

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Chapter 7 Consumer Behavior 1. Utility A measure of the amount of satisfaction a person derives from something. Rational individuals maximize utility when making choices. 2. Utility basics Incorporates emotions and sensations. Not typically comparable across individuals 3. Revealed preferences 显示性偏好 Hard to measure. The principle of revealed preference: observe people choices and behavior. Unique to a specific choice of particular person at one date. 4. Utility functions The principle of revealed preferences isn’t feasible for analyzing how people makes choices. Instead, a more formal method is required. Utility function aid in systematically analyzing choices. 5. Utility functions A formula for calculating the total utility that a particular person derives from consuming a combination of goods and services. 6. Bundle A unique combination of goods and services that a person could choose to consume.
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