Loss aversion can explain why very little ________ actually takes place in the securities market.
A)short selling
B)bargaining
C)bartering
D)negotiating

Question

Quizplus · Accepted Answer

Loss aversion refers to the psychological bias of individuals to feel the pain of a loss more acutely than the pleasure of an equal gain. This bias can make individuals hesitant to engage in activities that involve potential losses, such as short-selling in the securities market, where the potential for loss is unlimited. As a result, very little short selling actually takes place in the securities market due to loss aversion.

Loss Aversion Can Explain Why Very Little ________ Actually Takes