One Manifestation of the Endowment Effect as a Reference Point

question 53

Multiple Choice

One manifestation of the endowment effect as a reference point is:

• A) the willingness of an individual to trade a good based on his original endowment of that and other goods.
• B) the willingness of an individual to buy a good based on the ownership of that good by other individuals.
• C) the refusal of a person to sell a good for a price other than what she paid for it.
• D) a difference between the price that a person is willing to pay for a good and the price that she es willing to sell the same good to someone else.

---

Definitions:

Schengen Area

A zone comprised of 26 European countries that have abolished passports and all other types of border control at their mutual borders, allowing for free and unrestricted movement of people.

Internal Borders

Geographic and administrative boundaries within a country, distinguishing areas of jurisdiction or governmental authority.

EU Countries

Nations that are member states of the European Union, a political and economic union aiming for integration and harmonized legislation among its members.

Subsequent Federal Statute

A law enacted by the federal government that follows previously established legislation, potentially altering or refining legal standards or practices.