Author Question: Which of the following is an example of the endowment effect? A) A consumer places a higher value ... (Read 35 times)

luvbio · **on:** Jul 1, 2018

Which of the following is an example of the endowment effect?

A) A consumer places a higher value on a good currently owned as compared to a good they are considering purchasing.
B) A consumer uses a portion of income in order to provide income to future generations.
C) As a consumer's income increases, they increase consumption of most goods.
D) Consumers will tend to value objects the same for buying and selling.

Question 2

If good salespeople are extremely risk averse, then a choice between a fixed-fee contract and a contingent contract

A) avoids a moral hazard.
B) will result in all job candidates choosing the contingent contract.
C) will result in an efficient contract.
D) may not be a good screening device.