5. After some consideration, you decide to hire someone to help you move from one apartment to another. Wouldn't
it be cheaper to move yourself? Do you think the choice to hire someone is a rational choice? Explain your response.
6. Would you wait in line three weeks to be the first customer at Best Buy on Black Friday (the day after Thanksgiving, the "official start" of the holiday shopping season)? Two women from California did just that, taking turns holding their positions in line around the clock for over 500 hours. They waited in order to get a doorbuster deal on a new 50-inch television for $199 (the normal retail price of the model is $399). Discuss why they might be willing to wait in line three weeks in terms of incentives. Do you think their choice make sense? Answer this question by considering the marginal benefit that they receive versus the marginal cost they must pay.
8. We have talked about how trade creates value. Use the information in each example below to compute the total value created in each exchange:
a. Patrick bought an orange pen from Jill for $2.00. Patrick was willing to pay up to $2.50 for the pen, and Jill would have been willing to sell the pen for $1.25.
b. Hillary found a car on Craigslist for which she would have been willing to pay up to $10,000. The car's owner, Jason, needed to sell the car right away and would have accepted $6,000. The price they agreed on was $7,500.
5).It would be cheaper to move yourself without hiring someone. The choice to hire someone is not rational. The... View the full answer