According to prospect theory, A) people are concerned with ...

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According to prospect theory,
 
  A) people are concerned with wealth levels only.
  B) people are concerned with changes in wealth levels only.
  C) people never use a reference level when making their decisions.
  D) everybody is risk-neutral.

Question 2

One aspect of prospect theory is that people tend to
 
  A) be very risk averse to large gains.
  B) be very risk averse to losses.
  C) love losses more than gains.
  D) hate gains regardless of potential losses.

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Answer to Question 1

B

Answer to Question 2

B