The Anchoring Effect Describes When Decision Makers Fixate on Initial

question 59

True/False

The anchoring effect describes when decision makers fixate on initial information as a starting point and then, once set, they fail to adequately adjust for subsequent information.

---

Definitions:

Tariffs

Government levies on goods and services brought into the country, frequently employed to safeguard local industries against overseas rivals.

Absolute Advantage

The ability of an entity to produce a good or service more efficiently than its competitors, using fewer resources.

Textiles

Materials made from fibers, filaments, threads, or yarns, typically used in the production of fabrics and cloth.

Comparative Advantage

The ability of an entity to produce a good or service at a lower opportunity cost compared to others.