Cognitive Biases Quiz

Buttercup sees a new pair of sneakers she loves, but they're slightly above her budget. She remembers a similar pair she saw last week on sale and decides to wait, even though she's worried they might sell out. What concept is at play here?

• Framing effect

• Loss aversion

• Anchoring bias

• Sunk cost fallacy

Answer explanation

Buttercup's decision to wait for the sale due to budget concerns demonstrates loss aversion, where the fear of losing out on the sneakers outweighs the potential gain of buying them now.

Mr. Schorr is offered a free gym membership for a month. He's not sure if he'll like it, because he's not very motivated when it comes to exercise, but he figures 'why not?' This behavior is most likely due to:

• Endowment effect

• Opportunity cost

• Framing effect

• Zero-pricing effect

Answer explanation

Mr. Schorr's decision to try the gym due to the free membership aligns with the zero-pricing effect, where the lack of cost influences behavior.

Buttercup buys a concert ticket for her favorite band, "Retrievers Rock!" even though the seats are far back and expensive. She justifies it by thinking, 'Everyone else is going, and I can't miss it!' This behavior can be explained by:

• Herding mentality

• Loss aversion

• Framing effect

• Anchoring bias

Answer explanation

Buttercup's decision to buy the concert ticket due to everyone else going reflects herding mentality, where individuals follow the crowd without considering personal preferences.

Santalope gets a free cookie at the bakery. He enjoys it so much, he ends up buying a whole box at full price. This is an example of:

• Sunk cost fallacy

• Endowment effect

• Framing effect

• Availability bias

Answer explanation

Santalope valuing the cookie more after receiving it for free and buying a whole box at full price demonstrates the Endowment effect, where ownership increases perceived value.

Therapy Cat sees a new phone with a ton of features, but it's much pricier than her current one that still works well. She sticks with her old phone because the thought of losing its familiarity is off-putting. This is related to:

• Loss aversion

• Endowment effect

• Anchoring bias

• Status quo bias

Answer explanation

Therapy Cat's decision to stick with her old phone due to the fear of losing familiarity is an example of status quo bias, where individuals prefer to maintain their current situation even if better options are available.

A store offers a "buy one, get one 50% off" deal on T-shirts. Beyoncé buys two even though she only needs one, because the discount seems like a good deal. This can be explained by:

• Framing effect

• Loss aversion

• Decoy effect

• Availability bias

Answer explanation

Beyoncé's decision to buy two T-shirts due to the perceived discount is explained by the framing effect, where the presentation of choices influences decision-making.

Santana is saving up for a new video game. He sees a movie he really wants to watch, but decides against it because he doesn't want to "set back" his progress on his savings goal. This is an example of:

• Mental accounting

• Opportunity cost

• Framing effect

• Sunk cost fallacy

Answer explanation

Santana's decision not to watch the movie in order to save for the video game represents the concept of opportunity cost, where choosing one option means forgoing the benefits of another.

A restaurant offers two menu options: a small steak for $15 and a large steak with a side and dessert for $25. SpongeBob chooses the smaller steak even though he's quite hungry. He might be influenced by:

• Framing effect (perceived value)

• Loss aversion (fear of overspending)

• Anchoring bias (focusing on base price)

• Mental accounting (treating sides differently)

Answer explanation

SpongeBob might be influenced by loss aversion (fear of overspending) when choosing the smaller steak over the larger one with sides and dessert for a better perceived value.

Ghengis Khan is hesitant to try a new brand of yogurt even though friends recommend it. This could be due to:

• Framing effect (perceived value)

• Loss aversion (fear of overspending)

• Anchoring bias (focusing on base price)

• Status quo bias (preference for familiarity)

Answer explanation

Ghengis Khan's hesitation to try a new brand of yogurt is likely due to status quo bias, which is a preference for familiarity over trying something new.

A coffee shop offers a loyalty program: buy 10 drinks, get the 11th free. Stormtroopers are more likely to buy drinks to "reach" the free one, even if they wouldn't normally buy that many. This is an example of the:

• Framing effect

• Loss aversion

• Endowment effect

• Reward program effect

Answer explanation

Stormtroopers are influenced by the framing effect, where the perception of reaching a free drink motivates them to buy more, even if they wouldn't normally. This effect alters their decision-making process.