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Compose a 3000 words assignment on consumer decision-making models. Needs to be plagiarism free!
Compose a 3000 words assignment on consumer decision-making models. Needs to be plagiarism free! The theory assumes that the consumer is rational and performs a good evaluation of all the available alternatives regarding the costs and the value acquired, followed by a good selection of the product that will give him the greatest satisfaction. According to the model, consumers obey the doctrine of maximum utility that relies on the law of diminishing marginal utility. Here, the consumer, who has a limited buying power and a range of wants and tastes, will assign his income over a wide range of products at particular prices to optimize utility (Thaler 1980). The principle of utility gives the consumer the capability of securing the highest utility from his limited buying power. This theory of consumer behavior is simply unidimensional since it assumes that the consumer buying decision comes from the desire to maximize utility. This is because, for being a rational being, the consumer will only aim at achieving the highest benefits. The theory assumes that the consumer is rational and performs a good evaluation of all the available alternatives regarding the costs and the value acquired, followed by a good selection of the product that will give him the greatest satisfaction. According to the model, consumers obey the doctrine of maximum utility that relies on the law of diminishing marginal utility. Here, the consumer, who has a limited buying power and a range of wants and tastes, will assign his income over a wide range of products at particular prices to optimize utility (Thaler 1980). The principle of utility gives the consumer the capability of securing the highest utility from his limited buying power. This theory of consumer behavior is simply unidimensional since it assumes that the consumer buying decision comes from the desire to maximize utility. This is because, for being a rational being, the consumer will only aim at achieving the highest benefits. Furthermore, the economic model as pointed by Thaler ( out1 out980) relies on various predictions that include the price effect of the product, the price effect of close substitutes and the purchasing power of consumers. It suggests that the lower the price of the product the more likely consumers are going to buy the product. The lower the price of substitutes the lesser consumers will buy the original product and vice versa. In addition, the income effect suggests that the higher the purchasing power of consumers the more they are going to buy the product. . . However, there are various views that challenge the credibility of the model in explaining the real behaviour of consumers in the market. The model, to some extent, does not give the real picture of the behaviour of consumers in the market.
