b. incrementally alters an existing plan
Work Step by Step
Rational people think at the margin by considering how an action will alter their existing situation. We can measure this by marginal change, which is a small incremental adjustment to a person's existing situation. As a result, people often make decisions on the additional cost or benefit that an adjustment will bring. For example, if the marginal benefit of drinking a soda outweighs the marginal cost of that soda, rational people will choose to purchase the soda.