Question

Suppose that marie is buying bananas. she decides that she would like to purchase three bananas at the price of $0.25/banana but not a fourth banana. which of the five foundations of economics best describes marie's thinking?

Answer 1

we know that

The fundamental concepts on which economic models (decision-making) are based:

1) Incentives

2) Trade-offs

3) Opportunity cost

4) Marginal thinking

5) Trade creates value

where

Marginal thinking compare “additional” value of 1 more unit to its price when making purchase decision (not total value/cost of all units)

In this problem

Marie is thinking about the extra benefit and cost of purchasing each additional banana. This is what economists would describe as “thinking on the margin,” or marginal thinking.

therefore

the answer is

marginal thinking