Soo Jin shares a one-bedroom apartment with her classmate.Her share of the rent is $700 per month.She is considering moving to a studio apartment which she will not have to share with anyone.The studio apartment rents for $950 per month.Recently, you ran into Soo Jin on campus and she tells you that she has moved into the studio apartment.Soo Jin is as rational as any other person.As an economics student, you rightly conclude that

Question

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Soo Jin's decision to move into a studio apartment suggests that the additional benefit of having her own place (i.e., not sharing with anyone) is worth the higher rent. The difference between the rent she paid when sharing one bedroom ($700) and the rent for the new studio apartment ($950) is $250. Thus, she must feel that the additional benefit of having her own space is worth at least $250 per month, which makes choice B the best answer.

Soo Jin Shares a One-Bedroom Apartment with Her Classmate