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When the cost of a taxi ride rose, Martina started packing a lunch instead of going to a restaurant. Which economic principle does this demonstrate?

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Final answer:

Martina's switch from taking a taxi to a restaurant to packing a lunch illustrates the economic principle of opportunity cost, as she makes a decision that maximizes her utility within her budget constraint.

Step-by-step explanation:

The economic principle demonstrated by Martina's action is the concept of opportunity cost. When the cost of a taxi ride increased, Martina had to reassess her spending choices based on her budget constraints. She decided that the utility or satisfaction she would get from packing a lunch outweighed the increased cost and lost utility of taking a taxi to a restaurant. This reevaluation and the choice to opt for an alternative that offers greater satisfaction within her budget is a prime example of how consumers make rational decisions to maximize their utility, considering the marginal utility and opportunity cost of their choices.

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