If Alan Is Risk-Averse,then He Will Always

question 16

Multiple Choice

If Alan is risk-averse,then he will always

• A)choose not to play a game where he has a 50 percent chance of winning $5 and a 50 percent chance of losing $5.
• B)choose not to play a game where he has a 75 percent chance of winning $5 and a 25 percent chance of losing $5.
• C)choose to play a game where he has a 55 percent chance of winning $5 and a 45 percent chance of losing $5.
• D)All of the above are correct.

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Definitions:

Foot-In-The-Door Phenomenon

A psychological tactic involving getting a person to agree to a small request to increase the chances of agreeing to a larger request later.

Informational Social Influence

The influence to accept information from others as evidence about reality, often leading to conformity in ambiguous situations.

Cognitive Dissonance Theory

A psychological theory that explains the discomfort that arises from holding two conflicting beliefs, leading to changes in attitudes, beliefs, or behaviors.

Role-Playing Theory

A theory suggesting that much of behavior is influenced by society's expectations and that individuals perform roles they have learned based on social norms and expectations.