Susan's search costs are $7 per search. She wants to buy a coat, and the lowest price she has found so far is $180. Susan thinks 25 percent of the stores charge $180 for this coat, 50 percent charge $160, and the other 25 percent charge $150. Susan's optimal decision is to:
A. stop searching and purchase a coat for $180.
B. continue to search for a lower price since the expected benefit of an additional search is $17.50, which exceeds her per-unit search costs.
C. continue to search for a lower price since the expected benefit of an additional search is $10, which exceeds her per-unit search costs.
D. continue to search for a lower price since the expected benefit of an additional search is $7.50, which exceeds her per-unit search costs.
Answer: B
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