It\'s dinnertime, and you head off campus to a local pizza place. You notice tha

Question

It's dinnertime, and you head off campus to a local pizza place. You notice that the owner, who's a friend of yours, is running a promotion: If you come in as part of a group of eight or more, your group gets a free pitcher of soda with your meal.

You ask the owner about it."It's actually pretty cool," she says. "I was reading this study about how people eat more when they're in larger groups, so I decided to see for myself. And check it out-it's true!"

Sure enough, people were ordering slice after slice of pizza! How odd, you think, that just being part of a large group would make people eat more.

The fact that people choose to buy more food when they're in a larger group is consistent with the central thesis of behavioral economics:

1.people are predictably irrational
2.classical economic theory is useless because it's not grounded in reality
3.people are unpredictably irrational

Explanation / Answer

1.people are predictably irrational

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