Psychology
Anchoring Bias in Negotiation and Price Setting
Quick fact
In a classic study, asking people whether the Mississippi River was longer or shorter than 200 miles made them guess lower than when they were asked about 2,000 miles—even though both numbers were arbitrary.
Why this is interesting
You walk into a car dealership and the salesperson quotes a price double your budget. You laugh it off, but somehow you end up paying more than you planned. Why does that ridiculously high starting number still pull you toward it?