It is now January 1. You plan to make a total of 9 deposits of $8,000 each, one every 3 months with the first payment being made today. The bank pays a nominal interest rate of 11% but uses quarterly compounding. How much your account with the bank be if you leave the money in the bank to be withdrawn all in 16 years from today?

marginal decision

Explanation:

Marginal decision involves spending a little more or a little less than what has already been planned for based on the benefit to be gotten. If the marginal benefit exceeds the marginal cost, then the choice is a good choice. Marginal decision are made by using marginal analysis, that is comparing the cost and benefits of spending a little more or a little less.

In this scenario, she spends $1 more to buy her sister a doll because she thinks her sister would love it. The marginal cost in this case is $1. As a result on spending more on the gift, she spends less on her dress.