Question

question 2 (multiple choice worth 5 points) (bh.3h.mc) which of the following is an example of loss aversion? valuing something you own more than its actual worth choosing to keep gift money rather than investing it buying a product because it is popular with your friends refusing to purchase a product because it is too expensive

Explanation:

Loss aversion refers to the tendency to prefer avoiding losses over acquiring equivalent gains, often leading people to overvalue items they own (the endowment effect, a direct example of loss aversion, as losing the owned item feels worse than gaining its market value). The other options do not fit: keeping gift money is risk aversion, buying due to friends is social influence, and refusing an expensive item is standard cost-benefit judgment.

Answer:

Valuing something you own more than its actual worth