Consider three outcomes: $\mathrm{a}, \mathrm{b}, \mathrm{c}$ such that $abc$. Regret aversion implies which of the following? A) $U(a, b)

Question

Consider three outcomes: $\mathrm{a}, \mathrm{b}, \mathrm{c}$ such that $a>b>c$. Regret aversion implies which of the following? A) $U(a, b)

Quizplus · Accepted Answer

Regret aversion implies that the utility of moving from the worst outcome to the best outcome (U(c, a)) is less than the sum of the utilities of moving from the worst to the middle outcome and then from the middle to the best outcome (U(b, a) + U(c, b)). This reflects the idea that individuals prefer to avoid the regret associated with making a decision that could lead to the worst outcome, favoring a more incremental approach to decision-making.

Consider Three Outcomes a,b,c\mathrm{a}, \mathrm{b}, \mathrm{c}a,b,c Such That a>b>ca>b>ca>b>c Regret Aversion Implies Which of the Following? A)

Consider Three Outcomes $\mathrm{a}, \mathrm{b}, \mathrm{c}$ Such That $a>b>c$ Regret Aversion Implies Which of the Following?
A)