Asked by Daniela Guzman on Apr 24, 2024
Verified
Ian is such a big Braves fan that his benefit of seeing a Braves game is $200.He pays $100 for a ticket to see one of their playoff games.Unfortunately,he left the ticket in his jeans when he laundered them and the ticket was destroyed.According to marginal analysis,Ian should:
A) not go to the game.
B) buy another ticket for $100 and attend the game.
C) buy another ticket and attend the game only if he can buy the ticket for less than $100.
D) watch the game on TV.
Marginal Analysis
A review of the extra advantages gained from an activity in relation to the extra expenses it generates.
Benefit
The advantage or gain received from a decision, action, or policy, often used in the analysis of choices in economics.
- Understand the concept of marginal analysis and how it applies to decision-making processes.
Verified Answer
ZK
Zybrea KnightMay 02, 2024
Final Answer :
B
Explanation :
Marginal analysis focuses on the additional benefits and costs of a decision. In this case, Ian's benefit from seeing the game is $200. If he buys another ticket for $100, his net benefit is still $100 ($200 benefit - $100 cost), which is a positive outcome. The sunk cost of the destroyed ticket does not factor into the marginal analysis of buying a new ticket and attending the game.
Learning Objectives
- Understand the concept of marginal analysis and how it applies to decision-making processes.