Suppose You Pre-Ordered a Non-Refundable Movie Ticket to X-Men: Days

question 152

Multiple Choice

Suppose you pre-ordered a non-refundable movie ticket to X-Men: Days of Future Past. On the day of the movie you decide that you would rather not go to the movie. According to economists, what is the rational thing to do?

• A) Since the cost of the movie ticket is a sunk cost, it should not influence your decision. Your decision should be based solely on whether you want to see the movie or not.
• B) You should not waste resources. Since you have paid for the ticket you should watch the movie.
• C) You should go to the movie to minimize your losses.
• D) You should go to the movie to maximize your utility.

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Definitions:

Nicaragua

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Carter Administration

The executive period of Jimmy Carter, the 39th President of the United States, from 1977 to 1981, known for its emphasis on human rights and environmental issues.

Circumstances

The conditions surrounding and affecting the way in which events occur.

Cold War

A period of geopolitical tension between the Soviet Union and the United States and their respective allies from the end of World War II in 1945 until the dissolution of the Soviet Union in 1991, characterized by threats, propaganda, and other measures short of open warfare.