Joe Walks into Best Buy Prepared to Spend No More

question 10

Multiple Choice

Joe walks into Best Buy prepared to spend no more than $500 cash on a new computer,but the price turns out to be $600.Joe is told if he finances it on a Best Buy credit card,it will cost $600,but he will get a $25 gift card free with the computer.Joe opts to open the credit card and puts the full $600 on the account.According to economic theory,Joe's decision is:

• A) irrational.
• B) rational.
• C) budget-conscious.
• D) optimal.

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Definitions:

Egocentric

Focused on oneself and considering one’s own perspectives and interests above those of others.

Essentialist Tendency

The inclination to believe in an intrinsic, unchanging nature of things, often ignoring the influence of culture, context, and history.

Generalize

To make a general or broad statement by inferring from specific cases.

Average

A statistical measure representing the central or typical value in a set of data, calculated by dividing the sum of all values by the number of values.