Marginal thinking is best demonstrated by:

• A. choosing a college major based solely on your interests
• B. deciding whether to study one more hour for an exam based on the expected improvement in your grade
• C. buying groceries without considering prices or budget constraints
• D. comparing the total costs of two different vacation destinations

Answer: (B)

Verified step by step guidance

1. Understand the concept of marginal thinking: it involves making decisions based on the additional (marginal) benefit or cost of one more unit of an activity.
2. Identify the options given and analyze whether they involve comparing marginal benefits and marginal costs.
3. Recognize that choosing a college major based solely on interests does not involve weighing additional costs or benefits incrementally.
4. See that deciding whether to study one more hour for an exam involves comparing the expected improvement in your grade (marginal benefit) to the cost of that extra hour (marginal cost), which is a clear example of marginal thinking.
5. Note that buying groceries without considering prices or budget constraints and comparing total costs of vacations are not examples of marginal analysis because they do not focus on incremental changes.