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An investor assessing probabilities of outcomes depending on how similar they are to the current state is called:

a) Risk-averse
b) Prospect theory
c) Availability heuristic
d) Anchoring

User Petzi
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Final answer:

The correct answer to the question is: d) Anchoring

An investor assessing probabilities of outcomes depending on how similar they are to the current state is called anchoring bias.

Step-by-step explanation:

The correct answer to the question is: d) Anchoring

An investor assessing probabilities of outcomes depending on how similar they are to the current state is called anchoring bias. Anchoring bias refers to our tendency to rely on initial values, prices, or quantities when estimating the actual value, price, or quantity of something. If you are presented with a quantity, even if that number is clearly arbitrary, you will have a hard time discounting it in your subsequent calculations; the initial value "anchors" subsequent estimates.

For example, let's say you are asked to estimate the price of a laptop. The salesperson tells you the original price was $2,000, but it's currently on sale for $1,500. Your estimation may be biased towards the $2,000 price tag, even though the sale price is $1,500.

User Mattgi
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