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Tony Notes That an Electronics Store Is Offering a Flat

Question 68

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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,it is a good offer,but if he wants to buy something with a price of $500,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,in the first case,he saves 40% and,in the second case,he saves 4%.
D) "marginal cost equals marginal benefit" thinking.
E) opportunity costs.

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