Explain how the concept of consumer revealed preference is important to a customer .

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Cocept of consumer revealed preference is a method of analyzing choices made by individuals.It also used for comparing the influence of policies on consumer behaviour.This theory says that if a customer buy a bundle of goods,then that bundle is revealed preffered,given constant price and income,to any other bundle that the consumer could afford.By varying price or income, customer can conclude a representative model of the customer preference.This theory is based on observable behaviour.It concentrate on a minimal number of relatively unarguable assumptions.In revealed preference theory,there is theoretical framework for explaining consumer behaviour.It provide sufficient condition which can be actually tested,for observed choices to be consistent with utility maximization.This customer revealed preference is used to measure consumer preference and can be observe their purchasing behaviour.So it will help the customer to know about the products which is going to buy.

Rahul Sunny answered 1 year ago

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