Question

A restaurant sells three wines at $30, $40, and $50 per bottle. When it adds another wine to the list at a price of $22, the sales of the $30 wine increase by 50%. This is an example of (A) a context effect; (B) risk aversion; (C) self-control problems; (D) randomization.

Answer 1

Answer:

Option (A) A context effect

Explanation:

A context effect is a psychological effect in which the choices are influenced by the surrounding environmental conditions.

Here in the given question the addition of $22 wine bottled in the list influenced the customers perception as they may have started to feel that $30 is better and economic option and its price is near to the cheapest wine.