An example of loss aversion would include

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    an investor refuses to sell an asset below its purchase price even though the investor could use the capital loss to offset taxable capital gains income and invest the sales proceeds in income generating assets.
     an investor sells an asset below its purchase price to offset taxable capital gains income and invests the sales proceeds in a riskier asset with a high expected return in an attempt to make up for the loss.
     an investor sells an asset below its purchase price to offset taxable capital gains income and invests the sales proceeds in Treasury bills to avoid risk in the future.
     Both 1 and 2.
asked Jun 2, 2013 in Economics by anonymous
    

1 Answer

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an investor refuses to sell an asset below its purchase price even though the investor could use the capital loss to offset taxable capital gains income and invest the sales proceeds in income generating assets.
answered Jun 3, 2013 by Xyz ~Expert~ (3,650 points)



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