What is the endowment effect?
A) The phenomenon that economic agents are endowed with different qualities and abilities so that trade among individuals increases efficiency.
B) The tendency for economic agents with abundant resources to consume a proportionately greater quantity of goods and services.
C) The tendency for people to be unwilling to sell something they already own even if they are offered a price that is greater than the price they would be willing to pay to buy the good if they didn't already own it.
D) The tendency of firms to use celebrities endowed with good looks to promote their products.

Question

Quizplus · Accepted Answer

The endowment effect refers to the tendency for individuals to value something they already own more than they would be willing to pay to acquire it if they didn't already own it. This can lead to reluctance to sell an item even when offered a higher price than what the individual originally paid for it.

What Is the Endowment Effect