One explanation for a flat-rate bias is that it is just transitory. It takes consumers time to learn how much of a good they want to consume. Over time, they adjust their behavior and the flat-rate bias disappears.

Question

Quizplus · Accepted Answer

Flat-rate bias can be temporary as consumers initially overestimate their usage, but with experience, they adjust their consumption patterns, reducing the bias.

One Explanation for a Flat-Rate Bias Is That It Is