ECONOMICS

Detailed explanation-1: -The 5 steps are problem recognition, information search, alternatives evaluation, purchase decision and post-purchase evaluation.

Detailed explanation-2: -To explain information search, the economics of information identifies two types of search costs that influence information search – external and cognitive.

Detailed explanation-3: -The various models of consumers (economic view, passive view, cognitive view, and emotional view) depict consumers and their decision-making processes in distinctly different ways.

Detailed explanation-4: -For example, when a consumer is buying a car for the first time, it’s a big decision as it involves high economic risk. There is a lot of thought on how it looks, how his friends and family will react, how will his social status change after buying the car, and so on.