New parents have left their child with a babysitter for the first time. When the mother used to babysit as a teenager, she made two dollars an hour. She is sure if she increases that rate by 50%, she is paying a fair rate. When she pays the babysitter three dollars an hour, the babysitter is very upset that she was paid so poorly. This error is due to the mother using a/an ________,
A) representative heuristic
B) base rate
C) availability heuristic
D) anchoring and adjustment heuristic

Question

Quizplus · Accepted Answer

The mother is using the anchoring and adjustment heuristic, where she anchors her decision on her own past experience of earning $2 an hour as a babysitter and then adjusts the rate by increasing it by 50%. However, this adjustment is not enough as the mother is not taking into account the current market rate for babysitters or the specific circumstances of this particular babysitter.

New Parents Have Left Their Child with a Babysitter for the First