Rational Choice Theory Quiz

Rational Choice Theory states that individuals use their self-interests to make choices that will provide them with the greatest benefit, based on weighing the costs, risks, and benefits of the decision.

Philosopher Adam Smith is considered the originator of Rational Choice Theory.

Individuals use their personal preferences and self-interests to make choices that they believe will serve them best, even if the choices seem irrational to others.

<p>Personal preferences determine how individuals decide what will serve them best, influencing their choices based on their desires and needs.</p> Signup and view all the answers

<p>Adam Smith proposed in 1776 that human nature's tendency toward self-interest resulted in prosperity, which he termed 'the invisible hand' driving the free market.</p> Signup and view all the answers