According to this component of prospect theory,losing $100 would have a disproportionately larger effect on utility than winning $100 would.This phenomenon is known as:
A) the availability heuristic
B) framing
C) loss aversion
D) affective forecasting

Question

Quizplus · Accepted Answer

Loss aversion refers to the idea that people generally feel more negative emotion from losing something than they feel positive emotion from gaining something. This means that losing $100 would have a greater impact on someone's utility than gaining $100 would, and is a key component of prospect theory. The availability heuristic refers to the tendency to rely on readily available information when making judgments, framing refers to how information is presented influencing decisions, and affective forecasting refers to the process of predicting how we will feel in the future. While these concepts are related to decision-making and judgment, they are not specifically related to the disproportionate impact of losses on utility.

According to This Component of Prospect Theory,losing $100 Would Have