Anchor Effect and its relation to Decision making.

How does Anchor Effect influence our Decision making?

When an anchor price is set in our mind it becomes a basis for future decision making. This quirk of our brain is made us by marketeers to position their products.

The anchor effect and its relation to decision making has been illustrated by Dan Ariely in his book Predictably Irrational. This is one of the many irrational quirks of our brain.