Question

Which of the following are the correct assumptions for the utility approach?

Options

• Prices of commodities are given and continue to change.

• Consumer's income is given.

• Utility is not measurable in monetary terms

• All of the above

Answer 1

Consumer's income is given.

Explanation:

The utility approach implies that commodity prices and consumer income are fixed and will not change, and that utility is a quantifiable concept. As a result, of the above assumptions, the only one that holds true is that