Discuss how each of the following statements represent framing bias: i. Financial advisors will provide guidance on

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Discuss how each of the following statements represent framing bias:

i. Financial advisors will provide guidance on retirement and savings options for a small fee. They often promote their investing abilities over other advisors. The stock market has fallen 5% for the year but you see an ad for a financial advisor, “our investments have outperformed our competitors by 2%.” Why doesn’t the advisor want to advertise their actual return?

ii. A recent study found that high school seniors and community college students were less likely to attend a four-year institution when offered a financial aid package that included the word “loan” when compared with a financially equivalent package that omitted the word “loan.” In fact, when using the term “loan,”

students were 10% less likely to attending that particular university.

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Microeconomics

ISBN: 9781319245283

6th Edition

Authors: Paul Krugman Robin Wells

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