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 major, you rightly conclude that

Question

Quizplus · Accepted Answer

Soo Jin's decision to move to a studio apartment suggests that the additional benefit of having her own place is worth at least $250 per month. This is because she is willing to pay $950 per month for the studio apartment, versus the $700 per month for her share of the one-bedroom apartment she was previously sharing. Therefore, option B is the best choice. Options A and C are not correct since there is no information to suggest that Soo Jin's decision was based on her roommate's behavior or that the benefit of having her own place is worth $950 or more. Option D is also not correct as Soo Jin has made a rational decision based on her preferences and budget constraints.

Soo Jin Shares a One-Bedroom Apartment with Her Classmate