ECONOMICS
MONEY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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the things we have purchased in the past.
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the things we have purchased on credit.
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the things we could own.
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the things that we have sold.
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Detailed explanation-1: -The endowment effect describes a circumstance in which an individual places a higher value on an object that they already own than the value they would place on that same object if they did not own it. Endowment effect can be clearly seen with items that have an emotional or symbolic significance to the individual.
Detailed explanation-2: -The endowment effect is the tendency for people who own a good to value it more than people who do not. Its economic impact is consequential. It creates market inefficiencies and irregularities in valuation such as differences between buyers and sellers, reluctance to trade, and mere ownership effects.
Detailed explanation-3: -This cognitive bias is known as the endowment effect: the human tendency to attach more value to items we own simply because they belong to us. 5. In other words, once we own something, we value it more.
Detailed explanation-4: -The endowment effect is an emotional bias that says that once we own something, or have a sense of ownership, we irrationally overvalue it. Put more simply, the endowment effect leads people to place a greater value on things once they have established ownership, or a sense of ownership.
Detailed explanation-5: -What is the Endowment Effect? Coined by Richard Thaler, the Endowment Effect is the feeling of owning something, where the idea of possession increases its worth regardless of its objective market value.