People react differently to a five cents a gallon higher price for a credit card purchase than for a cash payment if it is framed as a cash discount rather than as a credit card surcharge. This shows they are subject to:
A)contrast effects
B)framing effects
C)confirmation bias
D)cash reversal bias
E)None of the above

Question

Quizplus · Accepted Answer

This is an example of framing effects, where the way information is presented (framed) affects decision-making or judgments. People perceive the same price difference differently when it is presented as a cash discount versus a credit card surcharge, even though the economic outcome is the same.

People React Differently to a Five Cents a Gallon Higher