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Money Manners: Textbook buyback formulas

Dear Jeanne and Leonard: I attend a small community college. One day, a girl in my algebra class noticed me studying for my history class and asked me if I would be willing to sell her my textbook when I was done with it, because she was going to take history next semester. She said she would pay me $25 for the book. Since this is what the campus bookstore pays to buy it back, I sold her the book. Then I began to think … after she’s done with it, she can resell the book to the bookstore or to someone else for $25, which would mean she had gotten the book for free. So now I’m wondering: Should I have asked more for the book, and if so, how much? For what it’s worth, the book costs $100 new, and the bookstore sells used ones for $75.

– Book Smart(?), Texas

Dear Book Smart: Any economics textbook, new or used, will have the complete answer to your question in the chapter on supply and demand. But here’s the short version: At any price below $75, your classmate was saving money by buying the book from you, so, yes, you probably should have asked for more – say, $50. At that price, she would be getting the book for $25 less than the bookstore charges, and you would be getting $25 more than the bookstore pays. Regardless of what she paid you, however, she was always going to be able to resell the book for at least $25. Too bad you didn’t realize that before you agreed to her price.

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Dear Jeanne and Leonard: Every couple of weeks, I have lunch with an old friend. Recently, she lost her job, and I know she’s having trouble finding a new one. Am I obligated to buy her lunch until she finds work?

– Michelle, Upstate New York

Dear Michelle: It certainly wouldn’t hurt to pick up the check at your next lunch. Your friend probably will appreciate the show of sympathy and support at least as much as the free meal. It is not, though, up to you to pay for all of the lunches the two of you share while she is unemployed. Instead, you should offer to go to less expensive eating places or to brown-bag it, if that’s what she would prefer.

Picking up the tab every now and then would be nice, as well. But in this situation, your obligation is to be sensitive to your friend’s circumstances and to help her find work any way you can; it’s not to systematically supplement her unemployment check.

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Dear Jeanne and Leonard: When my in-laws died, my husband’s oldest brother, the executor, took his sweet time to settle the estate. He found his parents’ home a convenient place to stay when in town, and he paid the insurance, utilities and repairs out of the estate’s bank account, ultimately burning through half of its initial balance. After several years, my husband got fed up and told his brother to sell the house or he would hire a lawyer to force his brother to wrap up the estate. After angry words, the house was sold and the estate divided. That was 20 years ago, and my husband and his brother haven’t spoken since. What I learned from this is that your executor should always be someone outside the family, since family members can and will fight to the death over estates. Don’t you agree?

– Sadder but Wiser, Arkansas

Dear S.B.W.: There’s an old saying that you had better hope that someone is a good person before he or she enters politics because character never seems to improve on the job. The same might be said of executors. The secret to picking a good one has less to do with the person’s relationship to the beneficiaries and more – much more – to do with his or her integrity, judgment and financial acumen.

That said, we agree that your premise is all too often true: Where there’s a will, there’s a fight. You should see our mail.

Please email your questions about money and relationships to Questions@MoneyManners.net.