Khaled's Furniture Alters, Reconstructs, and Restores an Old French Chest

Multiple Choice

Khaled's Furniture alters, reconstructs, and restores an old French chest. Khaled has just spent US$800 purchasing, cleaning and reconstructing the antique chest which he expects to sell for US$1,500. After having spent US$800, Khaled discovers that he would need some special wood that would cost him US$200 to complete the task. Alternatively, he can sell the chest "as is" now for US$900. What is his marginal benefit if he sells the chest "as is" now?

A) US$100
B) US$900
C) He makes a marginal loss of US$600, not a marginal benefit
D) The marginal benefit cannot be determined