Your Text Reports a Study by Shafir, Simon, and Tversky

question 126

Multiple Choice

Your text reports a study by Shafir, Simon, and Tversky (1993) in which participants were asked to consider either Scenario A, involving an attractive offer on a Sony product, or Scenario B, describing attractive offers on both a Sony and an Aiwa product. In each case, participants were asked if they would purchase a product or wait until they learned more about other models. In which condition were participants more likely to say they would wait rather than purchase a product, and why?

• A) Scenario A participants were more likely to wait. They would prefer more options before making a purchase.
• B) Scenario B participants were more likely to wait. Having even two options to consider makes decision making more difficult because of the demands on working memory.
• C) Scenario B participants were more likely to wait. Participants found it difficult to justify choosing one attractive option over another attractive option.
• D) Scenario A participants were more likely to wait. Utility theory suggests that optimal decision making requires more than a single option.

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Definitions:

Financial Statements

Documents and records that provide an overview of a company’s financial condition, including balance sheets, income statements, and cash flow statements.

Subscription

An agreement to receive or be able to access a product or service, typically on a recurring basis, such as monthly or yearly.

Entries

Refers to individual records of financial transactions in accounting, documented in journals and ledgers.

Check

A written, dated, and signed instrument that contains an unconditional order from the drawer that directs a bank to pay a definite sum of money to a payee.