Which of the following best describes a rational decision maker in microeconomics?

• A. Someone who systematically and purposefully does the best they can to achieve their objectives given available information and constraints.
• B. Someone who ignores opportunity costs when making choices.
• C. Someone who always chooses the option with the lowest monetary cost.
• D. Someone who makes decisions based solely on emotions.

Answer: (A)

Verified step by step guidance

1. Understand the concept of rational decision making in microeconomics: A rational decision maker is someone who makes choices aimed at maximizing their objectives, such as utility or profit, given the information and constraints they face.
2. Recognize that rationality involves systematic and purposeful behavior, meaning decisions are made thoughtfully and consistently to achieve the best possible outcome.
3. Recall that ignoring opportunity costs is not rational because opportunity cost represents the value of the next best alternative foregone, which is crucial for making informed decisions.
4. Note that always choosing the option with the lowest monetary cost is not necessarily rational, as it ignores other factors like benefits, utility, or long-term consequences.
5. Understand that making decisions based solely on emotions is not considered rational in microeconomics, as rationality requires decisions based on logical evaluation of information and trade-offs.