Billie jean has $120 to spend and wants to buy either a new amplifier for her guitar or a new mp3 player to listen to music while working out. both the amplifier and the mp3 player cost $120, so she can only buy one. this illustrates the basic concept thata. trade can make everyone better off.
b. people face trade-offs.
c. rational people think at the margin.
d. decisions made at the margin are not particularly important.