The Endowment Effect Suggests That That People

question 41

Multiple Choice

The endowment effect suggests that that people

• A) have a strong attachment to their entitlement, regardless of whether they paid to acquire them.
• B) have a strong sense of fairness.
• C) are concerned about the welfare of others.
• D) act in ways to distort market prices.

---

Definitions:

Marginal Costs

The change in total costs that arises when the quantity produced is incremented by one unit; it is the cost of producing one more unit of a good.

Potential Customers

Individuals or businesses that have not yet purchased but have shown interest in a company's products or services.

Expected Profit

The anticipated financial gain from an investment or business activity, considering possible risks and rewards.

Price

The sum of money anticipated, necessary, or provided in exchange for something.