llS Rest can be saved and resumed later J 15 drempt number 1. ing. Changes to th

Question

llS Rest can be saved and resumed later J 15 drempt number 1. ing. Changes to the answer after submission are Question Completion Status: Moving to the next question prevents changes to this answer. Question 7 A beer at the baseball stadium costs $10 each. According to the rule of rational choice, when will Rachel stop drinking beer? O a. when the marginal benefit received from consuming peanuts with beer just equals S10 O b. when the marginal benefit of an additional beer falls below $10 O c. when the marginal benefit of an additional beer equals zero O d. when the marginal cost of an additional beer is less than $10 > Moving to the next question prevents changes to this answer 13 MacBook Air

Explanation / Answer

Option b

According to consumer theory, an individual will drink till the point where Marginal benefit = Price which in this case is $10. Thus, the moment marginal benefit falls below $10, Rachel will stop drinking beer.

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