What must be true about the relationship between C and E?

Question

BlackTom AI · Accepted Answer

Understanding the question requires recognizing what information is actually provided about the consumer's preferences between C and E.
Option a: 'The consumer strictly prefers C to E.' This claims a definite ordering. However, from the prompt we have no data about any choice behavior, utility, or revealed preferences that would establish a strict ranking. Therefore, asserting a strict preference is not justified.
Option b: 'There is not enough information to know how the consumer compares the two goods.' This is a cautious and accurate assessment whenever we lack a described preference relation, utility values, or observed choices between C and E. It acknowledges the missing data rather than making an unsupported claim.
Option c: 'The consumer strictly prefers E to C.' Like option a, this asserts a specific strict preference in the opposite direction without supporting evidence. There is no information to justify preferring E over C.
Option d: 'The consumer is indifferent between the two goods.' Indifference implies equal utility or satisfaction from both goods, which again requires information not provided. Indifference cannot be concluded from the given prompt.
In summary, without any observed choices, utility measurements, or stated preferences between C and E, the most defensible position is that there is not enough information to determine how the consumer compares the two goods. The other options each make a definite claim about the preference ordering that cannot be supported by the information given.

ECC2000 - ECC5900 - S2 2025 ECC2000/5900 Mid-Semester Test - Quiz - 8 September 2025, opens 2pm (Melbourne, Australian time) duplicate

What must be true about the relationship between C and E?

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