Question: question a & b 61. a) 13) Answer the following questions regarding prospect theory (10%) My can we say that consumers' attitude toward risk is

question a & b

61. a) 13) Answer the following questions regarding prospect theory (10%) My can we say that consumers' attitude toward risk is risk-averse and why? (3%) Ford recently announced a $500 cash rebate on their Ford Focus. Your parents bought the M were surprised that the dealership gave them a $500 check after the purchase rather than reducing the total price of the car. Hm they were quite happy that they received the cash payment. Explain using prospect theory, why the dealership chooses to give a check after the purchase rather than provide a reduction in the price of the car. Please demonstrate your reasoning on the diagram of Prospect Theory value function. (7%) You can draw a diagram manually, scan or take a photo of the diagram, and email me the scan/photo (together with any verbal elaboration you may provide)

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