If You Were to Behave According to the Rational Choice

Multiple Choice

If you were to behave according to the rational choice model when confronted with a loss of $25 on the same day in which you receive an unexpected gift of $25 you would

A) Value the loss of $25 more heavily than the gain of $25
B) Discount the loss and value the gain so that you feel you have gained welfare
C) See the two events as exactly offsetting and thereby of no consequence in your overall welfare
D) Value the gift of $25 more than the loss of $25