When Respondents Are Given the Following Two Choices a and B

Multiple Choice

When respondents are given the following two choices A and B, a majority choose B over A.
Choice A: $5,000,000 with probability .10, $1,000,000 with probability .89; 0 with probability .01.
Choice B: $1,000,000 with probability 1.
When respondents are given the following two choices C and D, a majority choose C over D.
Choice C: $5,000,000 with probability .10 and 0 with probability .90.
Choice D: $1,000,000 with probability .11 and 0 with probability .89.
These choices are a violation of the principles of Expected Utility theory, which suggests that if one chooses B over A, then that person should choose D over C.
A potential explanation for this pattern of behaviour is the following.

A) In A, the 0.89 probability on $1,000,000 is underweighted, making the gamble relatively less appealing than the certain million. However, in C and D, the low probabilities of both gambles are now being over-weighted, making C the relatively more attractive choice.
B) This is an example of the well-known conjunction fallacy, where people evaluate the probability of a subset of an event as being higher than the event itself.
C) In A, the 0.89 probability on $1,000,000 is over-weighted making this gamble less appealing than the certain million. However, in C and D, the low probabilities of both gambles both gambles are now being under-weighted, making C the relatively more attractive choice.
D) People judge choices from some reference point and here the reference point is $1 million.