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Logan Has $2,000 in a Checking Account and Wants to Buy

Question 105

Multiple Choice

Logan has $2,000 in a checking account and wants to buy a new MacBook for $1,100. Logan decides he needs the money in his account to pay his bills next month, so he buys the MacBook by charging the $1,100 to his credit card and paying it off gradually over the next several months. Logan choosing to "save" his cash on hand for bills is:


A) irrational, because money is fungible.
B) rational, because Logan can now pay all his bills right away.
C) irrational, even though it will make him wealthier in the long run.
D) rational, because he now has both a new computer and money in the bank.

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