In Talking to a Travel Agent, T

question 12

Multiple Choice

In talking to a travel agent, T. J. Matthews learned that he could get a three-day/two night package near Disneyworld for his family of four or for the same amount of money, he could have a five-day/four-night stay at a hotel that was about fifty miles away from Disneyworld. Matthews decided the farther hotel was a much better value. Matthews defined value as:

• A) All that I get for all that I give
• B) Whatever I want in a service
• C) Low price
• D) Reliable service
• E) The quality I get for the price I pay

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Definitions:

Marginal Social Cost

An increased charge to the general public for the creation of one more unit of a product or service.

Pollution

The presence in or introduction into the environment of a substance or thing that has harmful or poisonous effects.

Marginal Social Benefit

The additional benefit society gains from consuming one more unit of a good or service.

Marginal Social Cost

The additional cost imposed on society as a whole by producing one extra unit of a good or service.