The two parts of this excerpt from W. W. Jacobs's "The Monkey's Paw" show that show the White family doesn't believe in the talisman's power are:
"Sounds like the 'Arabian Nights,'" said Mrs. White, as she rose and began to set the supper.
The 'Arabian Nights' were stories made up by the narrator Scheherazade and told to the King over 1001 nights so that he would not kill her as he had done with so many other women in the past. In this way, it signifies that Mrs. White believes this story to be a made-up tale.
and
"Don't you think you might wish for four pairs of hands for me." Her husband drew the talisman from his pocket, and all three burst into laughter
Mr. White is jokingly asking to be given four pairs of hands, something that isn't sensible or realistic, because he does not believe in the power of the talisman to grant wishes. In the end the three burst in laughter as they do not take the talisman, or the story of it's power, seriously.
It would be the second one
