The tendency for movie viewers to interpret shots in relation to surrounding shots is the most fundamental assumption behind all film editing. how does editing take advantage of this psychological tendency?

Editing basically exploits your emotions. For example, adding sad music to a scene can make the scene be sad even though the actions happening might not be that sad per se. Or you can use things like slow motion for something dramatic. This way things that might be lame or absurd look much cooler and you as a viewer become emotional.