What mental accounts do you have in your mind about purchasing products and services? Do you have any rules you employ in spending money? Are they different from what other people do? Do you follow Thaler's four principles in reacting to gains and losses?
Mental accounting is the set of cognitive operations used by consumer to code, categorize and evaluate financial outcomes of choices. Researchers have found the consumer handling their money by using mental accounting. While purchasing product and services I have following mental accounts in my mind: ·Product importance and its need: Before buying the product, the very first thing I see is the need of that product and its importance in my life and accordingly I'll make the decision of buying. ·Quality: I will also see at the product quality. If it meet the standard quality of what I am looking in that product and make the decision of buying it. ·Price: I'll also look at the price, see it reasonable or not so that I could afford, or is the price is set as per its quality and is it worth to buy in that amount, and make the decision accordingly. ·Availability: While purchasing I'll also see whether that product is easily available or not and what kinds of products of which b...