What is the best definition of regret aversion?
A) The tendency to focus on avoiding short-term losses, even at the expense of long-term gains.
B) The tendency to avoid making a decision because you fear that the decision would have been less than optimal.
C) The tendency to consider something that you own to be worth more than it would be if you did not own it.
D) Confusion between real buying power and nominal buying power.
E) The reliance on instinct instead of analysis in making decisions.

Question

Quizplus · Accepted Answer

Regret aversion refers to the fear of making a decision that could lead to regret, causing individuals to avoid making decisions altogether to prevent the possibility of feeling regretful about a less than optimal choice.

What Is the Best Definition of Regret Aversion