#cfa #cfa-level-1 #economics #microeconomics #reading-14-demand-and-supply-analysis-consumer-demand #section-3-utility-theory #study-session-4
Given the understanding of consumption bundles (what defines a bundle), the first assumption we make about a given consumer’s preferences is simply that she is able to make a comparison between any two possible bundles. That is, given bundles A
, she must be able to say either that she prefers A
, or she prefers B
, or she is indifferent
between the two. This is the assumption of complete preferences
(also known as the axiom of completeness), and although it does not appear to be a particularly strong assumption, it is not trivial either.