Consumer Theory Of Consumer Behavior Essay

703 Words Nov 16th, 2015 3 Pages
Introduction "Economic man is an imaginary perfect rational person who maximizes his/her economic welfare or being and achieves the consumer equilibrium by thinking marginally all the time. The importance of this concept is hinged in the theory of consumer behavior in which real people function such as this fictional entity" (Wansink, 2006) For many decades, economists thought that the choices people make were rational, especially since it was prompted by their selfish needs to maximize their output and the limited choice created by scarcity. But it turned out not to be the case. For example: "Consumer B just had a bad day at work. He’s depressed, bored and craving some excitement. He goes to the mall to do some browsing and sees a stylish new fishing pole on display. Consumer B hasn’t been fishing in six months and already owns two other fishing poles, but this particular fishing pole arrests his attention. Consumer B starts thinking about how much he would like to own this fishing pole and how exciting it would be to buy it. But Consumer B has a limited amount of money to spend, and the fishing pole is very expensive. However, Consumer B quickly rationalizes his purchase by arguing that it will make him happy. Without even knowing how well the fishing pole will work or when he will use it, Consumer B purchases it on the spot—with his credit card." (Behavioral Economics. (n.d.)) This the concept of the economic man with regards to maximization. The concept…

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