Question

Under what condition might persons buy more of something than the efficient amount for them to buy?

Short answer

Persons might buy more of something than the efficient amount due to several factors such as fear of product unavailability, having imperfect information, lack of self-control, societal influence, and misperception of benefits and costs.

Step-by-step solution

Understanding Market Efficiency

Market efficiency is a situation in which goods in a market are distributed in a way that no one can be made better off without making someone else worse off. This efficient point is usually where supply meets demand or where the marginal cost of production equals the marginal benefit the consumer derives from that product.

Recognizing Consumer Behavior

Consumers tend to buy a product up to the point where the marginal benefit equals the marginal cost. This is considering they have perfect information and always act rationally to maximize their utility. However, in the real world, consumers may not always act rationally or have perfect information. Thus, it becomes possible for a consumer to buy more of a product than the efficient amount.

Analyzing Factors Leading to Overconsumption

Overconsumption can happen under several conditions. Examples include: 1) If consumers perceive that the product will be unavailable in the future. 2) There's imperfect information about the product. 3) There is a lack of self-control and instant gratification is valued more. 4) Consumers are influenced by other people's consumption or societal consumption norms. 5) There's a misperception of benefits and costs...