Prospect Theory

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Cruz H


Date added:

October 20, 2015








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3 / 834


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The theory intends to explain why people behave irrationally when making choices. 2. Framing effect. It refers to the difference in response to the same question represented in different ways. This technique is frequently used in marketing ads campaign, such as PAD. 3. Sunk-Cost effect. When people have put effort into something, they are often reluctant to pull out because of the loss that they will make, even if continued refusal to jump ship will lead to even more loss...
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It can be applied into trivial daily activities or significant decision making in project planning at work. For example, my boss probably will not approve my one-month vacation request. However, he is more likely to approve if it is in the form of a series of applications for five days each month over the next half year period...
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