Matt Has Decided to Purchase His Textbooks for the Semester

question 84

Multiple Choice

Matt has decided to purchase his textbooks for the semester. His options are to purchase the books via the Internet with next day delivery to his home at a cost of $175, or to drive to campus tomorrow to buy the books at the university bookstore at a cost of $170. Last week he drove to campus to buy a concert ticket because they offered 25 percent off the regular price of $16. According to the cost-benefit principle:

• A) it would not be rational for Matt to drive to campus to purchase the books because the $5 saving is only two percent of the cost of the books, and that is much less than the 25 percent he saved on the concert ticket.
• B) it would be rational for Matt to drive to campus to purchase the books because it costs less to buy the books there than via the Internet.
• C) it would be rational for Matt to drive to campus to purchase the books because the $5 saving is more than he saved by driving there to buy the concert ticket.
• D) it would not be rational for Matt to drive to campus to purchase the books because the cost of gas and his time must certainly be more than the $5 he would save.

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Definitions:

Literally Occur

An event or action that takes place exactly as described or indicated without metaphor or exaggeration.

Agreement

A mutual understanding or arrangement between two or more parties outlining their respective rights and duties.

Novation

Novation is the legal act of replacing an existing obligation with a new one, substituting a new party or obligation into an original contract.

Original Promisor

The individual or entity who initially makes a promise in a contractual agreement, especially in contexts involving subsequent assignments or transfers of obligations.