This document discusses how mental accounting impacts consumer decision making. It explains that people value gains and losses differently depending on the scenario, such as choosing a guaranteed $10 prize over a 50% chance of winning $20 even though the expected values are the same. The document provides assignment questions about mental accounting, how companies can take advantage of it, and how consumers can avoid its pitfalls. Students are asked to write a 3-5 page paper addressing these questions and citing sources using APA format.

1. Argosy B6025 Module 4 Assignment 2 Expected
Value and Consumer Choices NEW
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Consumers' choices are prey to subtle
discrepancies that arise in cognitive accounting.
Learning how and when you are prey to these
discrepancies is an important step in improving
your decision making.
As the readings for this module demonstrate,
people value gains and losses differently under
different scenarios. For example, contestants in
a game show might choose a guaranteed $10
prize over a 50 percent chance of winning $20
despite the fact that the expected values are the
same.

2. Using the readings for this module, the Argosy
University online library resources, and the
Internet, address the following:
What is mental accounting and how does it impact
consumer decision making?
How might a company take advantage of
consumers' mental accounting? Give examples. As
a marketer, how might you frame certain decisions
to benefit from the disparities that arise in one's
cognitive accounting?
As a consumer, how would you avoid the pitfalls
posed by the inequalities of one's cognitive
accounting?
Write a 3-5-page paper in Word format. Apply APA
standards to citation of sources. Use the following
file