When an investor purchases a share of stock at $50 and the stock tumbles to $35,...
When an investor purchases a share of stock at $50 and the stock tumbles to $35, the investor with loss aversion prefers to:
A) sell the stock at $35 and use the proceeds to make a better investment.
B) keep the stock and avoid the losses, at least until the price returns to $50.
C) buy more shares at 35 dollars.
D) leave the stock market.
Homework Answers
A . Sell the stocks at $35 and use the proceeds to make the better investment because there is the risk of further shortfall on price
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When an investor purchases a share of stock at $50 and the stock
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