In Prospect Theory, _____ Refers to the Fact That People

question 12

Multiple Choice

In prospect theory, _____ refers to the fact that people will forgo a superior choice (a potential benefit) to avoid a loss.

• A) risk seeking
• B) loss aversion
• C) source dependence
• D) escalation of commitment

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Definitions:

Written Contract

A legally binding agreement between two or more parties that is put in written form and signed by those involved, specifying the terms and conditions of their arrangement.

Sale of Goods

A transaction between two parties where the seller transfers ownership of tangible personal property to the buyer for a price.

Auction Without Reserve

An auction at which the auctioneer cannot withdraw goods unless no bid is made within a reasonable time.

Auctioneer

A person who conducts sales at auctions by accepting bids and declaring goods sold.