TOEFL Speaking Task 3

The concept of 'anchoring' in decision-making refers to the tendency of individuals to rely too heavily on the first piece of information offered (the 'anchor') when making judgments. Once an anchor is set, subsequent decisions are made by adjusting away from that anchor, but adjustments are often insufficient, leading to biased outcomes. Anchoring is a cognitive bias that affects various domains, including pricing, negotiations, and even legal judgments. The initial value, whether relevant or arbitrary, shapes the final decision.

Professor: So, let's talk about anchoring in real life. Imagine you're at a store and see a high-end watch priced at $2,000. That price becomes your anchor. Later, you see a similar watch on sale for $800. Compared to $2,000, $800 seems like a bargain, so you buy it, even though the watch might normally sell for $600 elsewhere. You've anchored on that first price and didn't adjust enough. Another classic example: in a law school study, mock juries were asked to set a fine for a defendant. If the prosecutor suggested a high fine, like $100,000, jurors gave higher awards than when the prosecutor suggested a low fine, say $10,000. The suggested number—even though it was just a suggestion—anchored the jurors' decisions. They adjusted from that anchor, but not enough to reach a truly fair amount.