Asked by Brendan Nicholas on Jul 13, 2024
Verified
According to the phenomenon of loss aversion,most people expect that the negative impact of losing $1000 will be greater than the positive impact of winning $1000.What would this phenomenon have an impact on
A) the informal development of schemas
B) the types of decisions people make
C) short-term memory
D) collective intelligence
Loss Aversion
A principle in behavioral economics suggesting that individuals are more sensitive to losses than to equivalent gains, leading to risk-averse decision-making.
Schemas
Mental structures that organize our knowledge and assumptions about something and are used for interpreting and processing information.
- Differentiate between various cognitive styles and their cultural influences.
Verified Answer
MB
Michael BabumbaJul 18, 2024
Final Answer :
B
Explanation :
Loss aversion can impact the types of decisions people make because it may cause them to be more risk-averse and avoid losses, even if the potential gain outweighs the potential loss. This can lead to missed opportunities for gain.
Learning Objectives
- Differentiate between various cognitive styles and their cultural influences.
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