Question

In your opinion, how much time should a consumer spend on shopping (searching) for lower prices (you may want to apply the marginal analysis)?

Answer 1

A consumer should spend that much time on searching for lower prices until his marginal benefit of the search is equal to the marginal cost of the search.

If he considers his time more valuable then his time on searching for lower prices would be smaller and vice versa.

The optimal point is given by the condition when Marginal benefit= Marginal cost because if marginal cost exceeds marginal benefit then the cost for the search would be higher than the benefits of the shopping whereas when marginal benefit exceeds marginal cost then he should spend more time on searching as this is an inefficient condition.