Sookie advertises her bicycle for sale on Craigslist for $1,000 but is willing to accept $700. The best offer she receives is $500. Why does she not sell her bicycle?
A)Her marginal cost is more than the best offer she received.
B)The opportunity cost is too high.
C)Her consumer surplus is $200, which is not close enough to her reservation price.
D)She would be paying $200 for someone to take the bicycle.

Question

Quizplus · Accepted Answer

Her marginal cost is not directly mentioned, but the context implies that Sookie's reservation price (the lowest price she is willing to accept) is $700. Since the best offer she received is $500, which is below her reservation price, she does not sell the bicycle. The other options do not accurately describe the economic reasoning behind her decision.

Sookie Advertises Her Bicycle for Sale on Craigslist for $1,000