Question

Evaluate the following statement. "We shouldn’t generalize from what people do in the ultimatum game because $10 is a trivial amount of money. When larger amounts of money are on the line, people will act differently."

Answer 1

Answer:

People behavior with lump sum amount:

The experimental evidence shows that people always expect to be treated fairly. When people are treated unfairly, then they will reject the offer regardless of the value of money. Thus, the statement that "should not generalize the evident resulted from $10 experiment. When the size of money is large then people will react differently from the evidence" is false.