Effects of Loss Aversion Research Paper Example | Topics and Well Written Essays - 1000 words

Effects of Loss Aversion - Research Paper Example This gives an explanation of curvilinear shape of prospect theory. The same philosophers argue that people prefer risks to exposing themselves to losses. This theory also explains sunk cost theory. The theory applies that, when one lose $100, he will be more satisfied than a person who losses $100 windfall. In reference to marketing, we make use of trial periods or rebates with the aim of taking advantage of the tendency of the buyers. This is to value the gods more than the incorporation in the status quo (Kahneman, Knetsch, & Thaler 10). It is crucial note that, despite the fact that transactions are framed on losses or gains, is significant to have the following calculation. Is there a discount or a surcharge? Change in price is differently framed and has impacts on loss aversion. In reference traditional economist, loss aversion together with other endowment effect is irrational. This is the reason why they ate highly essential in the field of behavioral finance and marketing. Th is effect was demonstrated together with other effects in a customer reaction study, which related insurance policies and price changes. From the study, they found that prices raises customer reaction twice in case of its alteration (Kahneman, Knetsch, & Thaler 10). Research question This proposal encompasses effects of loss aversion. It also contains different ideas relating to the theory. Objectives To lean all the effects and impacts of loss aversion Methodology This proposal entails ideas from different individuals. This is to ensure that the research is all rounded and is suit for further empirical studies. In reference to results from different philosophers, there is a need to apply different methodologies to ensure to enhance reliability and completeness of the research. These methodologies entail questionnaires, experiments, interviews, surveys among others. These methodologies are applied in different fields of study, in respect with their fitness. In this case, questionnai res will be applicable in instances, where there is some level of specification. The setting of questionnaires will be different in reference with the target group. Questionnaires and interviews are the key research methodologies. However, interviewing is effective in areas where the research expected is to be analyzed with some level of formality. Other methods are supplements of the above methodologies. Literature review Colin Camerer is Rea and Lela Axline professor of business economics at California institute of technology. Camerer investigates decision making with regards to psychophysical considerations. His thesis in this journal is that; St. Petersburg paradox might be explained using loss aversion without concave utility. He goes further to defend it by saying it is theoretically useful; is a principle that can explain many puzzles economically, given that it has the correct psychological foundation. This was published by the American marketing association (Kahneman, Knets ch, & Thaler 11). The author’s main interest is in finding out whether; loss aversion is an expression of fear, or a stable preference fear and properties in loss aversion. According to Camerer, prospect theory has the power to explain how people value risk. A fruitful and parsimonious alternative, to the expected theory of utility is introduced by prospect theory. It as well introduces psychophysical and perceptual perspective in thinking about money, goods and risks. In the findings is a

Animal Behavior (Biology) Essay Example | Topics and Well Written Essays - 1500 words

Animal Behavior (Biology) - Essay Example sneaking behaviors are relevant due to the fact since females are the restraining sex, and females invest more in offspring than males, males tend to be competing for females. (Roche 2006) This proves to be a significant evolutionary requirement and is especially t evolutionary requirement and is especially relevant when taking evolution and sneaking behaviors into account. Given the evolutionary requirements and the success of sneaking behavior in the context of reproducing and the ability to do so it becomes obvious why the Haplochromis burtonii who succeed at this mating form of natural selection will prevail and evolve. In order for evolution to succeed natural selection is first required to be a success. My hypothesis as to why the sneaking strategy is favored in certain circumstances is that it succeeds evolutionary because f a disparity in the population of females. If the population of males is more than can be supported by the population in order to survive they can do so by being a sneaker. This is beneficial to the sneaker male because by impersonating a female he is able to a nest in a manner that does not require fighting and his chances of injury is reduced or eliminated. I also think that inclusive fitness may be beneficial to the survival and imminent evolution of the male. ... This premise means that as a minimum a number of this variation must be heritable. By that it is meant that a genetic basis of behavior must be present. This is because a basis for both successful natural selection and evolution behavior must affect the ability of an animal to survive and reproduce. By making reference to inclusive fitness it is meant that the male may have a better chance to reproduce if favored by the females in this respect. However it is important to observe altruism is not a high priority behavior within Haplochromis burtonii populations. However it can exist in regard to inclusive fitness behaviors and by practicing sneaking behavior the sneaker male has a better chance of benefiting from inclusive fitness from the females. Roche explains that "Inclusive fitness can be estimated using a coefficient of relatedness, which estimates the chances that two related individuals both have a given allele (alternately: the proportion of genes that are identical in two individuals because of relatedness)." (2006) I hypothesize that by participating in sneaker behavior the Haplochromis burtonii literally doubles chances of either reproducing or surviving until they are able to do so. 1) c) How could you test this empirically What predictions do you make if the hypothesis is true To test this hypothesis empirically would prove to be a challenge. The reason for that is the challenge of tracking the specific Haplochromis burtonii would be difficult and specific subjects would be impossible to distinguish during many parts of the observation. There is no way to mark the subjects. However the behavior of the Haplochromis burtonii can be observed. It is during the course of these observations that