An Introspection of Luxury Auto Sales Using Revealed Preference Theory

Revealed preference is a powerful tool within the realm of consumer theory and behavioral economics used to determine proclivity towards goods services which maximize their individual utilities in scenarios where alternatives would have only suppressed utility, first coined by American economist Paul Samuelson 1938. The then prefers good or service from this maximation stems. Using cross-sectional dataset Carvana Co. on automobile sales January September 2022, study uses Weak Axiom Preference (WARP) binary relation show amongst three bundles (brands prices). All examined brands were compared quantity units moved across sixty identical price points, so considered controlled variable for terms research. We represent our finding graphically WARP as well construct an ordinal utility function prove maximization achieved brands.