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T/F: According to utility theory, non-transitive decisions are perfectly rational

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Final answer:

No, non-transitive decisions are not perfectly rational according to utility theory.

Step-by-step explanation:

No, according to utility theory, non-transitive decisions are not perfectly rational. Utility theory is a theory of decision-making that assumes individuals make choices based on the satisfaction or utility they expect to receive from different options. Non-transitive decisions occur when the preferences of an individual are inconsistent or not completely ordered. For example, if a person prefers option A over option B, and option B over option C, utility theory would expect them to prefer option A over option C. However, in non-transitive decisions, this preference ordering may not hold true. Therefore, non-transitive decisions are not considered perfectly rational according to utility theory.

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