EBK ECONOMICS
5th Edition
ISBN: 8220106907184
Author: KRUGMAN
Publisher: YUZU
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Question
Chapter 9, Problem 1BCQ
To determine
The case with example of a type of rational decision making and explain.
Concept Introduction:
Rational Decision Making: Rational decision making is a process to make a decision with the help of facts objectively rather than to rely upon the personal judgments.
Expert Solution & Answer
Explanation of Solution
- The process of rational decision making involves making a choice between different alternatives from being objective.
- In the given case, the J Company makes a strategy to sell the discount coupons to its shoppers to increase sales. The strategy involved increase in the prices of goods and then provides discount coupons to customers.
- This did not make the company lose out on revenue, rather customers of the shop were attracted by this offer.
- Hence, the company made a rational decision of discount coupon sales because it increased the revenue.
Conclusion:
Thus, here discount coupon sale is an example of rational decision making.
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