Question 1Minimum credit card payment may encourage people to take longer to pay off their credit card bills, this is an example of...Choice overloadAnchoringThe bystander effectThe endowment effect
Question
Question 1Minimum credit card payment may encourage people to take longer to pay off their credit card bills, this is an example of...Choice overloadAnchoringThe bystander effectThe endowment effect
Solution
This is an example of Anchoring. Anchoring refers to the cognitive bias where an individual depends too heavily on an initial piece of information (the "anchor") to make subsequent judgments during decision making. In this case, the minimum credit card payment is the "anchor" that people might rely on when deciding how much to pay off each month, which could lead them to take longer to pay off their bills.
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