Mr.andMrs.LandMr.andMrs.Hwentona
fishing trip in the northwest and caught some salmon. They packed the fish and sent it home on an airline, but the fish were lost in transit. They received $300 from the airline. The couples take the money, go out to dinner and spend $225. They had never spent that much at a restaurant before.
2. Mr. X is up $50 in a monthly poker game. He has
a queen high flush and calls a $10 bet. Mr. Y owns 100
shares of IBM which went up 1 today and is even in 2
the poker game. He has a king high flush but he folds. When X wins, Y thinks to himself, “If I had been up $50 I would have called too.”
3. Mr. and Mrs. J have saved $15,000 toward their dream vacation home. They hope to buy the home in five years. The money earns 10% in a money market account. They just bought a new car for $11,000 which they financed with a three-year car loan at 15%.
4. Mr. S admires a $125 cashmere sweater at the department store. He declines to buy it, feeling that it is too extravagant. Later that month he receives the same sweater from his wife for a birthday present. He is very happy. Mr. and Mrs. S have only joint bank accounts.