Morgan lives in San Francisco and likes to dine out. Morgan has noticed that prices at restaurants near popular tourist destinations in the city tend to be higher than at restaurants of the same quality in other neighborhoods. One reason for this is that:
A)search costs are higher for people who are unfamiliar with the area.
B)residents don't like to eat in restaurants frequented by tourists.
C)tourists don't worry about money while on vacation.
D)restaurant meals are a small fraction of the total cost of a vacation.

Question

Quizplus · Accepted Answer

The cost of acquiring information will be higher for tourists who are not familiar with their surroundings. The higher cost of searching means that tourists will spend less time searching for a better deal and will end up spending more because of it.

Morgan Lives in San Francisco and Likes to Dine Out