Your Best Friend Asks to Borrow $100 Until Next Week

question 270

Multiple Choice

Your best friend asks to borrow $100 until next week. You say no. He then asks if he can borrow $20 and you agree. You have fallen victim to

• A)the foot-in-the-door technique
• B)the door-in-the-face technique
• C)lowballing
• D)the primacy effect
• E)the fundamental error

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Definitions:

Employee Stock Option

A privilege, sold by one party to another, that gives the buyer the right, but not the obligation, to buy (call) or sell (put) a stock at an agreed-upon price within a certain period or on a specific date.

Fixed Price

A pricing strategy where the cost of goods or services is set at a specific amount and does not fluctuate.

Buy Shares

The act of purchasing ownership interests in a company, thereby becoming a shareholder entitled to dividends and capital gains.

Lower Bound

The minimum value that a theoretical price, such as an option's price, can reach.