Theory of Consumer Choice
Subject: Economics | Topics:

Consumer choice theory is a way of analyzing how consumers may achieve equilibrium between preferences and expenditures. It also helps us to understand how individuals’ tastes and incomes influence the demand curve. In microeconomics, the theory of consumer choice relates preferences (for the consumption of both goods and services) to consumption expenditures; ultimately, this relationship between preferences and consumption expenditures is used to relate preferences to consumer demand curves.

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