Exam 10: An Introduction to Behavioral Economics

Suppose Evan and Robert are each filling out a separate survey about parking on campus. On Evan's survey, the first question asks about whether he thinks the fine for parking illegally on campus should be $50, and on Robert's survey the first question asks about whether he thinks the fine should be $100. For both Evan and Robert, the second question asks how much each thinks the fine currently is. If Evan and Robert know nothing about the parking fines on campus, but each uses anchoring and adjustment to form his assessment, then, all else equal, you would expect:

________ is the general resistance to change, often stemming from loss aversion.

Because every policy change generates winners and losers, loss aversion generates:

According to the representative heuristic, if Roger has many of the characteristics of a millionaire, then people will:

The present aim standard of rationality accommodates a much ________ range of observed behavior than traditional economic models, but has been criticized because the model is too ________.

When Tversky and Khaneman asked one group of people to imagine that, having previously purchased a ticket for $10, they arrive at the theater to discover they have lost their ticket and a second group of to imagine that they arrive just before the performance to buy a ticket and find they have lost $10 from their wallets, the majority of people in the lost ticket group said they ________ still attend the performance, and the majority of people in the lost $10 group said they ________ still attend the performance.

According to the availability heuristic, which of the following will make Katie more likely believe that she will win a lot of money if she buys a lottery ticket?

In traditional economic models, which of the following does NOT describe homo economicus:

According to the adaptive rationality standard, people's goals:

If an entity is fungible, then its individual units are:

In laboratory experiments, researchers have found that the behavior of Proposers and Responders in the ultimatum game is consistent with people:

________ is the property of an entity whose individual units are interchangeable.

Fungibility is the property of an entity whose individual units:

The Weber-Fechner law is the relationship according to which the perceived change in any stimulus:

Impulse control problems can arise when people:

The ________ is a game in which the first player has the power to confront the second player with a take-it-or-leave-it offer.

Traditional economic models assume that people care about:

In numerous experiments, researchers have found that if a Proposer and a Responder are asked to split a fixed sum on money in the ultimatum bargaining game, the Proposer will, on average, offer the Responder:

The general resistance to change, often stemming from loss aversion, is known as:

Status quo bias is the: