According to prospect theory, _____.
A) losses loom larger than gains for consumers even when the outcomes of decision models are of the same magnitude
B) gains are more important to consumers than losses though both have the same value
C) when asked to set a price for an item to be exchanged, sellers typically ask for a much lesser price than buyers are willing to pay
D) sellers perceive selling an item that they own as a self-gain
E) ownership of a product decreases the value associated with it

Question

Quizplus · Accepted Answer

Prospect theory states that people weigh the potential losses and gains of a decision and that losses typically loom larger than gains of the same magnitude. This means that consumers may be willing to take greater risks to avoid losses than they would have to obtain gains.

According to Prospect Theory, _____