You have just purchased a new Ford Taurus for $20,000, but the most you could get for it if you sold it privately is $15,000. Now you learn that Toyota is offering its Camry, which normally sells for $25,000, at a special sale price of $20,000. If you had known before buying the Taurus that you could buy a Camry at the same price, you would have definitely chosen the Camry. True or false: From what we are told of your preferences, it follows that if you are a rational utility maximizer, you should definitely not sell the Taurus and buy the Camry. Explain.

  • CreatedDecember 12, 2014
  • Files Included
Post your question