Any consumer trying to decide whether to buy a given good or service will base the decision on his or her reservation price and the existing market price. When making this decision, the buyer's reservation price measures the

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Business

Destinee Bryant

8 January, 17:05

Any consumer trying to decide whether to buy a given good or service will base the decision on his or her reservation price and the existing market price. When making this decision, the buyer's reservation price measures the

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Answers (1)

Know the Answer?

Porter Romero · Answer 1

The correct answer is: marginal cost.

Explanation:

The reservation price is the maximum amount a consumer is willing to pay for a good or service or the minimum amount a buyer is willing to accept to sell a product. The reservation price takes into account the marginal cost since, in this case, it represents the amount that the buyer will eventually pay.