According to prospect theory
A) losses are more important to consumers than gains, even if the magnitude of the two is the same.
B) gains are more important to consumers even if the two are the same magnitude.
C) consumers will spend a lot of time and effort prospecting for a bargain.
D) consumers will not accept alternatives with a rating below a minimum cutoff level.
E) consumers rarely respond to promotional offers of "12 months to pay with no interest."

Question

Quizplus · Accepted Answer

According to prospect theory, losses are more important to consumers than gains. This means that consumers are more sensitive to losses of a certain amount than they are to equivalent gains. Therefore, even if the magnitude of the gain and loss is the same, consumers will be more affected by the loss.

According to Prospect Theory