Answer to Question #304068 in Microeconomics for Entle

Question

Janice has decided to upgrade her security system at home. She hears that ADT offers more technologically advanced alarms than its competitor Beyers and at a lower subscription price. After speaking to her friends, she discovers that they all use Beyers. They agree that ADT’s alarm is more appealing but state that the add-on service and patrols provided by Beyers served as a drawcard. Janice thus chooses Beyers. Can you explain her decision?

Answer 1

Janice chooses beyers security firm because she will draw more utility from the firms add on services compared to ADT though the ADT firm offers more cheaper services.