Tony Notes That an Electronics Store Is Offering a Flat

Multiple Choice

Tony notes that an electronics store is offering a flat $20 off all prices in the store. Tony reasons that if he wants to buy something with a price of $50, then it is a good offer, but if he wants to buy something with a price of $500, then it is not a good offer. This is an example of:

A) inconsistent reasoning; saving $20 is saving $20.
B) the proper application of the Cost-Benefit Principle.
C) rational choice because saving 40 percent is better than saving 4 percent.
D) inconsistent reasoning because prices are sunk costs.