Jared declines to purchase a new bicycle priced at $200.An economist would conclude that:

Question

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An economist would conclude that Jared declined the purchase because the expected marginal benefit of the bicycle is less than $200. This means that Jared does not think that the benefits he will receive from owning the bicycle are worth the cost of $200, or that the benefits are not significant enough to justify the expense. It is not necessarily a reflection of his enjoyment of riding a bicycle or the fairness of the price charged by the seller. Option B cannot be the correct answer because if the expected marginal benefit of the bicycle to Jared exceeded $200, he would have made the purchase. Options D and E do not make sense in the given context.

Jared Declines to Purchase a New Bicycle Priced at $200