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Suppose the Auckland City Council Decides That When They Send

Question 24

Multiple Choice

Suppose the Auckland City Council decides that when they send out the letter to house-owners about their rates (taxes) for the year, it will include a statement of the following type. "Would you like to donate $10 to KidsCan (a charitable donation that helps children suffering from cancer) ? If so, then please check the box below." An economist advised the Council that they would most likely raise a lot more money if they said the following instead. "Your current rates include a donation of $10 to KidsCan. If you DO NOT want to make this donation then please check the box below." In making this suggestion the economist is appealing to the:


A) The framing effect.
B) The priming effect.
C) The endowment effect.
D) Loss aversion.

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