Many advertising slogans seem to be asserting something about people's preferences. How would you...

Question:

Many advertising slogans seem to be asserting something about people's preferences. How would you capture the following slogans with a mathematical statement about the utility function? Either find a utility function for each of the examples or discuss what properties should it have.

a) Promise margarine is just as good as butter.

b) Things go better with Coke.

c) You can't eat just one Pringle's potato chip.

d) Krispy Kreme glazed doughnuts are just better that Dunkin' Donuts.

Utility Function:

A utility function expresses preferences over alternatives goods according to the utility which is derived from their consumption. These alternative goods could be of substitute or complementary nature which structures the mathematical expression of the function.

Answer and Explanation:

a) Promise margarine is just as good as butter -

Here "as good as" phrase has been used which signifies that margarine can also be used in...

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Utility Theory: Definition, Examples & Economics

from Financial Accounting: Homework Help Resource

Chapter 1 / Lesson 27
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