11 Multiple Choice 1 point Michaelobserved hefelt the pain of losing a 20 bill more than he felt the joy of finding it on the sidewalk the week before.This is a result of... Overconfidence Sunk cost Loss aversion Endowment effect

The scenario described in the question is a classic example of the concept of "Loss Aversion". This is a principle in behavioral economics that suggests people have a tendency to prefer avoiding losses over acquiring equivalent gains. In other words, the pain of losing something is psychologically about twice as powerful as the pleasure of gaining something of the same value. In this case, Michael felt the pain of losing his $20 bill more intensely than the joy of finding it, which is a clear demonstration of loss aversion. The other options, Overconfidence, Sunk cost, and Endowment effect, do not accurately describe this scenario. Overconfidence refers to an excessive belief in one's abilities, Sunk cost refers to a cost that has already been incurred and cannot be recovered, and the Endowment effect is the tendency for people to overvalue things simply because they own them. Therefore, the correct answer is Loss aversion.