A college student who looks at the spending of money from loans differently from the spending of scholarships, differently from the spending of money from parents, and differently from money earned would be exhibiting what cognitive bias?
A) Loss aversion
B) Overconfidence
C) Mental accounting
D) Representativeness

Question

Quizplus · Accepted Answer

Mental accounting refers to the tendency of individuals to categorize and treat money differently based on its source or intended use, which is exactly what the college student is doing by viewing money from loans, scholarships, parents, and earnings differently.

A College Student Who Looks at the Spending of Money