John has an economics test tomorrow. He must study and has planned the rest of his day so that he can fit some study time in. He has decided to go to the gym and then study for several hours. Which of the following statements is true?
A) John did not use the economic way of thinking because his decision on how to allocate his time did not involve money.
B) John's decision on how to allocate his time is inconsistent with the rationality assumption since he has decided to go to the gym.
C) John's decision on how to allocate his time is consistent with the rationality assumption since the decision is intended to make him better off.
D) John's decision does not involve his pursuit of self-interest.

Question

Quizplus · Accepted Answer

John's decision to go to the gym and then study for several hours is consistent with the rationality assumption because he is making a decision that he believes will make him better off. The fact that his decision does not involve money does not mean that he is not using economic thinking. Additionally, it is not inconsistent with the rationality assumption to pursue activities that are not purely for financial gain, such as going to the gym for health and wellness. Finally, John's decision does involve his pursuit of self-interest as he is trying to do well on his economics test.

John Has an Economics Test Tomorrow