The Endowment Effect

question 45

Multiple Choice

The endowment effect

• A) Refers to the observation that people tend to value something more highly when they own it than when they don't
• B) Refers to the observation that people tend to value something more highly when they don't own it than when they do
• C) Refers to the fact that when confronted with many alternatives, people sometimes avoid making a choice and end up with the option that is assigned as a default
• D) Refers to the observation that people do not have a strong attachment to the status quo

---

Definitions:

Self-efficacy

The belief in one's capabilities to organize and execute the courses of action required to manage prospective situations.

Low Standards

Refers to minimal or inferior criteria or expectations in various contexts, including personal, professional, or quality expectations.

Defensive Pessimism

A strategy where an individual lowers their expectations to help prepare for the worst-case scenario.

Counterproductive

Activities or behaviors that hinder or go against the achievement of one's goals or objectives.