Joe is shopping for a new computer. A computer can be delivered to Joe's home for $1,200. Alternatively, Joe can pick up the same computer at the warehouse for $1,000. How should Joe buy the computer?
A. Joe should drive to the warehouse because $1,000 is less than $1,200.
B. Joe should drive to the warehouse if his cost of driving to the warehouse is less than $200.
C. Joe should drive to the warehouse because the $200 he would save by driving to the warehouse is more than 10% of the purchase price.
D. Joe should drive to the warehouse if his cost of driving to the warehouse is greater than $200.
Answer: D
You might also like to view...
The effect of substitution bias is that the rise in the price of a fixed basket of goods over time tends to ___________________ the rise in a consumer’s true cost of living, because it doesn’t take into account that the person can substitute between goods according to changes in their relative prices.
a. stabilize b. understate c. overstate d. reduce
Which of the following characteristics is generally representative of developed countries relative to developing nations?
A. a shorter life expectancy B. a smaller percentage of children enrolled in college C. a smaller percentage of the population working in agriculture D. a higher rate of infant mortality