Suppose 1,000 students were split into two groups of 500.Both groups were first presented with an image of a new high-end pair of jeans produced by Tommy Hilfiger,a clothing company.
The first group was given the following statement and then asked the following question: "The normal retail price of these jeans is $100.Would you be willing to pay $75 for them?"
The second group was given the following statement and then asked the following question: "The normal retail price of these jeans is $250.Would you be willing to pay $75 for them?"
Suppose that 24 percent of the students in the first group answered yes and that 73 percent of the students in the second group answered yes.It is likely that more students in the second group were willing to pay $75 for the pair of jeans because they were told the normal price was much higher.This is an example of a ________ effect in decision-making.
A) clothing
B) marketing
C) utilitarian
D) framing
E) psychosomatic

Question

Quizplus · Accepted Answer

This is an example of framing effect in decision-making where the presentation of information (in this case, the normal retail price of the jeans) influences the decision-making of individuals. The second group was more willing to pay $75 because they were told the normal price was much higher, which framed the $75 price as a good deal.

Suppose 1,000 Students Were Split into Two Groups of 500