Nikos Has the Opportunity to Start His Own Business Doing

question 16

Multiple Choice

Nikos has the opportunity to start his own business doing what he loves. However, in order to do this, he would have to liquidate all of his resources. He would even have to sell his home and use all his savings. He finally decides that he has too much to lose and sticks with his current job, which is less fulfilling but offers a guaranteed fixed income. Nikos is making his decision based on ____.

• A)temporal discounting
• B)error management theory
• C)learned helplessness
• D)risk aversion

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Definitions:

Quart

A unit of liquid volume equal to two pints, approximately 0.946 liters in the United States.

Pound

A unit of currency used in the United Kingdom and other areas, or a unit of weight equal to 16 ounces.

Convex Preferences

Consumer preferences that signify a desire for diversified bundles of goods, represented by convex-shaped indifference curves.

Indifferent

A term used in economics and decision theory to describe a situation where an individual or consumer does not prefer one option over another.