What's the economic meaning of beer?
John is hosting George for lunch at his apartment.
The available lunch fixings are as follows:
2 plain hot dogs with buns
1 sealed foil pak of mustard, enough for only 1 hot dog
1 small, leaky keg of beer
1 empty 9 ounce plastic cup
Assumptions : As soon as John has drawn beer from the keg to the plastic cup, the rest of the beer in the keg will leak uselessly away down the drain. The cup cannot be shared.
John has no idea what George's food preferences are.
John and George have always been very competitive, and neither would willingly allow the other to get the better of any situation.
John sets two places at the table. Each place has a hot dog with bun.
One of the places has the foil pak of mustard and the other has the plastic cup of beer.
George is allowed to choose where to sit.
What economic fact(s) can be deduced from the outcome of this process? [ed]