Economics · Revealed Preference Theory
With respect to Revealed Preference Theory (Samuelson), which of the following are TRUE? A. If bundle A is chosen when bundle B is affordable, then A is revealed preferred to B. B. The Strong Axiom of Revealed Preference (SARP) implies transitivity of revealed preferences across multiple choices. C. Revealed preference theory requires the assumption of a cardinal utility function. D. If WARP holds but SARP is violated, the consumer's choices may be rationalised by a utility function in more than two goods. E. Revealed preference analysis can be used to test whether observed demand behaviour is consistent with utility maximisation.
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1A, B, C and E only
- 2A, B, D and E only
- 3A, B and E only✓
- 4A and B only
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A, B and E only
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