While Waiting in Line to Buy One Cheeseburger for $1

question 97

Multiple Choice

While waiting in line to buy one cheeseburger for $1.50 and a medium drink for $1.00, Sally notices that she could get a value meal that contains both the cheeseburger and medium drink and also a medium order of fries for $2.75. She thinks to herself, "Is it worth the extra 25 cents to get the medium fries?" To an economist, Sally's decision is an example of:

• A) marginal analysis.
• B) basing decisions on total, rather than marginal, value.
• C) an unintended consequence.
• D) the fallacy of composition.

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Definitions:

Statistical Significance

A determination that a relationship between variables or a difference between groups is likely not due to chance, based on a predetermined threshold.

Reject

In the context of statistical hypothesis testing, to conclude that the evidence is sufficiently strong to discard the null hypothesis.

Binge Drinking

The consumption of an excessive amount of alcohol in a short period of time, typically defined as five or more drinks for men and four or more drinks for women in about two hours.

Analysis Result

The outcome or conclusions derived from systematically examining and interpreting data.