"Losses loom larger than gains." What concept explains this statement?
A)Diminishing sensitivity
B)Transitivity
C)Loss aversion
D)Preference reversal
E)Risk aversion

Question

Quizplus · Accepted Answer

This statement relates to loss aversion, which means that people feel the pain of losses more strongly than the joy of gains. Loss aversion can explain many behaviors, such as why people are hesitant to sell a stock that has lost value or why individuals may be risk-averse when it comes to potentially losing money.

"Losses Loom Larger Than Gains