What Is an Example of an Endowment Effect

question 12

Multiple Choice

What is an example of an endowment effect?

• A) Mark paid $3,100 for a used car that he values at $4,000. Recently, Mark was offered $4,400 for the car but refuses to sell it.
• B) Sammy receives increasing marginal utility as his 401K plan increases.
• C) Toby prefers a guaranteed $200 to a gamble with an expected value of $200.
• D) Deana refuses to transfer money from her checking account into her savings account, even though she has paid all her monthly bills.

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Definitions:

Interpersonal Role Disputes

Conflicts between individuals that arise from differing expectations about their respective roles in a relationship or social context.

Unconditional Positive Regard

A therapeutic practice where the therapist accepts and supports the client regardless of what they say or do.

Conditions Of Worth

Conditions on which the positive regard of others rests.

Empathy

The ability to understand and share the feelings of another, putting oneself in another's shoes emotionally.