The Endowment Effect Suggests That That People

question 27

Multiple Choice

The endowment effect suggests that that people

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

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Definitions:

Treatment Variable

A variable manipulated by researchers in an experiment to determine its effect on an outcome measure; also known as the independent variable.

Testable Hypotheses

Statements that make predictions about the relationship between variables, which can be empirically tested through scientific research.

Hypothesis-Testing Approach

A method in research that involves making predictions, formulating a hypothesis, and then empirically testing it.

Nonmanipulated Independent Variable

A variable in a research study that occurs naturally without any intervention or control by the researcher.