Michael Is a College Student

question 126

Multiple Choice

Michael is a college student.He can either buy a textbook for $100 or save up for a road trip he wants to take during the summer.This illustrates the principle that

• A)trade can make everyone better off.
• B)people face trade-offs.
• C)rational people think at the margin.
• D)people respond to incentives.

---

Definitions:

Plasma Screen

A type of display technology used in televisions and computer monitors, known for its bright, clear images and wide viewing angles.

Higher Education

This term refers to education beyond high school level, usually provided by universities and colleges, leading to degrees or certificates.

Equilibrium Prices

A price point where the demand for a particular item matches its supply, ensuring market equilibrium.

Price Inelastic

A characteristic of goods for which demand does not significantly change with a change in price, indicating consumers' necessity or lack of substitutes for the product.