7
QuizMultiple Choice

Smart Investing and Financial Decision-Making — Quiz

Question 7 • Personal Finance

What is loss aversion?

Answer
A
Investing randomly
B
Ignoring risk
C
Fear of losing money
D
Preference for gains

Explanation

Loss aversion is the tendency to feel the pain of losing money more strongly than the pleasure of gaining the same amount. Therefore, it means fear of losing money. Preference for gains alone does not capture this stronger reaction to losses.

AI-written and checked against the verified answer.

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