Jane is trying to decide how many TV shows she should watch

Jane is trying to decide how many TV shows she should watch tonight. She gets $10 of value from each TV show she watches. If she watches one show she gives up working on her math homework (which she values at $5). If she watches two, she also gives up her economics homework (which she values at $8). If she watches three then she also has to give up her biology homework (which she values at $12). Using marginal analysis, how many shows does she watch?

a)Zero

b)Two

c)One

d)Three

Solution

Using marginal analysis,JAne watch two T.V shows because watching the third show will make his marginal value less from a T.V show than from doing homework. Therefore, option(b) is correct.