What does independence assume about preference order?

Independence in the context of preference order implies that an individual's choice between two options should remain consistent regardless of additional choices presented. This concept is often discussed in decision theory and relates to the idea that if a person prefers option A over option B, that preference should persist even when a third option is introduced. The introduction of this third option should not affect the relative preference order between A and B.

When preference order is independent, it indicates that preferences are stable and do not fluctuate with the presence of irrelevant alternatives. Therefore, if A is preferred to B, that preference will not change whether or not other options are available. This notion of consistency and stability is fundamental in both economics and decision-making theories, illustrating that preferences are hierarchical and not influenced by external additions.

On the other hand, the other options introduce concepts that deviate from this core principle of independence. Changes in preference order due to added choices imply a lack of independence. Similarly, assuming that all choices are equally preferred does not align with the notion of a defined preference order, which values some options over others. Lastly, saying preferences are based solely on market value disregards the subjective nature of individual preferences, which can be influenced by various personal factors beyond just market considerations.