In evaluating the sensitivity of an alternative to its first cost, Its AW was calculated for changes in the estimated first cost by - 10%, + 5%, and +15%. The resulting AW values were $+21,000, $-2410, and $-34,000, respectively. On the basis of these values, one could conclude that Multiple Choice O O the attractiveness of the alternative is not sensitive to its first cost. the attractiveness of the alternative is slightly sensitive to its first cost. the attractiveness of the alternative is highly sensitive to its first cost.

What do you think of the ethics of using unconscious nudges to alter people’s behavior?

d)  Another classmate cares more about good grades: She gets 50 units of happiness for a B and 80 units of happiness for an A. If this classmate were your partner (but your preferences remained the same), how would your answers to parts (a) and (b) change? Which of the two classmates would you prefer as a partner? Would she also want you as a partner?

Bleecker Street runs from A to B, as shown in the diagram. The lone convenience store currently in operation along this street is at A. An entrepreneur who wants to open another store in the neighborhood is weighing a choice between the only two available locations, C and D. If customers, who are uniformly distributed along Bleecker Street, always shop at the store nearest to where they live, which of the locations C or D would be optimal from the perspective of customers and why? A C D B O Location D because that would minimize the average travel time for customers. O Location D because that would mean each store would get an equal share of the market. O Location C because that would give the new entrepreneur higher profits. O Locations C and D would be equally attractive because consumers have no reason to care about the relative profitability of different entrepreneurs.