Question

Fred just purchased an expensive new refrigerator and is considering purchasing the overpriced warranty. In making his decision on the warranty, Fred ignores better ways that his money could be spent, including paying off high-interest credit card debt. According to prospect theory, the process that leads Fred to ignore the debt and buy the overpriced warranty is anchoring. confirmation bias. framing bias. mental accounting.

Answer 1

Answer:

anchoring

Explanation:

In simple words, The anchoring phenomenon can be understood as the cognitive prejudice in which a single comparison source or 'anchor' influences a person's judgments. Following the setting of the anchoring number, a person 's future statements, estimations, and so on may differ from what things might have remained sans the anchor.

Thus, from the above we can conclude that the correct answer is anchor.