The ___ Occurs When People Assess the Likelihood of Something

question 17

Multiple Choice

The ___ occurs when people assess the likelihood of something occurring based on its similarity to a stereotyped set of occurrences.

• A) representativeness heuristic
• B) availability heuristic
• C) escalation heuristic
• D) satisficing heuristic
• E) anchoring and adjustment heuristic

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Definitions:

Deadweight Loss

Deadweight loss refers to a loss in economic efficiency that can occur when the equilibrium for a good or a service is not achieved or is not achievable.

Marginal Cost

The cost of producing one additional unit of a product or service, reflecting the change in total cost that arises from an increase in production.

Socially Efficient

The optimal allocation of resources that occurs when the social welfare is maximized, accounting for all costs and benefits to society.

Price Discrimination

A strategy where a seller charges different prices for the same product or service to different customers, based on the market segment each represents.