Consider the following hypothetical scenarios:
Scenario A: You are about to purchase a pair of 7 for All Mankind jeans for $175 and a t-shirt for $45.The sales attendant at the store tells you that the pair of jeans you wish to buy is on sale for $160 at another store, located about a 20-minute drive away.
Scenario B: You are about to purchase a pair of 7 for All Mankind jeans for $175 and a t-shirt for $45.The sales attendant at the store tells you that the t-shirt you wish to buy is on sale for $30 at another store, located about a 20-minute drive away.
Based on standard economic theory, under which scenario would you make the 20-minute trip to the other store?
A)Scenario A because the pair of jeans is a very expensive item and $15 saving is quite substantial
B)Scenario B because a $15 saving amounts to a substantial discount (about 33 percent)
C)in either scenario if I think a $15 savings is worth the 20-minute trip
D)in none of these scenarios if I think the $15 saving is not worth the 20-minute trip
E)C and D are correct answers.

Question

Quizplus · Accepted Answer

Economic theory suggests that the decision should be based on whether the $15 savings is worth the 20-minute trip, regardless of the item's price or percentage discount. Therefore, both C and D are correct, depending on personal valuation of time and savings.

Consider the Following Hypothetical Scenarios