Sometimes We Will Do Something We Normally Wouldn't Choose to Do

question 150

Multiple Choice

Sometimes we will do something we normally wouldn't choose to do, but we do so because of the money or effort which we have already spent. This is termed the

• A) sunk cost effect.
• B) availability heuristic.
• C) fundamental attribution error.
• D) actor-observer bias.

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Definitions:

Total Revenue

The total amount of money generated by the sale of goods or services before any costs are deducted.

Unit Elastic

A situation where a percentage change in price leads to an equal percentage change in quantity demanded or supplied.

Total Revenue

The total income generated from the sale of goods or services by a company before any costs or expenses are deducted.

Midpoint Formula

In economics, it's often used to compute the elasticity of demand or supply, calculating the percentage change in quantity demanded or supplied relative to the percentage change in price.