According to Kahneman and Tversky, Prospect Theory (also known as Loss Aversion Theory) posits which of the following:

Multiple Choice

• a. Faced with an investment choice with an equal probability of outcome, people prefer uncertain outcomes to certain ones.

• b. Faced with an investment choice with an equal probability of outcome, due to their aversion to losses, people tend to choose the choice presented in terms of losses.

• c. Faced with an investment choice with an equal probability of outcome, people place more weight on perceived gains than on perceived losses.

• d. All of the above (A,B and C)

• e. None of the above (A, B and C)

Answer rating: 100% (QA)

The answer is option B B is correct because as Kahneman and Tversky found pe... View the full answer