Question

Suppose apartments are in four​ locations: Location​ A, Location​ B, Location​ C, and Location D. Location A is in the​ city, where your job is. Location B is 10 minutes farther from your job

than Location A. Location C is 10 minutes farther from your job than Location​ B, and Location D is 10 minutes farther than Location C. In​ turn, similar apartments in Location B rent for ​$175 less per month than apartments in Location​ A, apartments in Location C rent for ​$175 less than in Location​ B, and apartments in Location D rent for ​$175 less than in Location C. Suppose the value of your time is ​$22 per hour and you work 21 days per​ month, with each day requiring a​ round-trip commute from your apartment to work. For​ simplicity, assume rent and the opportunity cost of your time commuting to work are the only factors influencing the location in which to rent an apartment. Location and net benefit?

Answer 1

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