Behavioral Economics Lessons 1 - 3 Flashcard

Front

What bias is being used in an advertisement promoting a “limited time offer!” with a countdown clock?

Back

Fear of Missing Out (FOMO)

Front

Behavioral economics is

Back

The study of how irrational factors affect individuals' economic decisions

Front

Guy bought tickets for a concert but there is a heavy snowstorm. He decides to go anyway because he already paid for them. This is

Back

Sunk Cost Fallacy

Front

Ally signs up for a Netflix trial. Because she "owns" a full account, she values it highly and signs up. This is

Back

The endowment effect

Front

Peter can choose between two retirement accounts. Fearing a loss, he opts for the more conservative one. This is a type of

Back

Loss Aversion

Front

Paula sees photos of a concert her friends attended, which she couldn't go to because of work. She feels like an outsider.

Back

Fear of missing out (FOMO)

Front

Which of the following is an example of loss aversion?

Back

Deciding not to sell your house for less than what you bought it for

Front

Confirmation bias is …

Back

The tendency to seek information that supports our existing beliefs

Front

People who win the lottery tend to return to their original levels of happiness after the novelty of winning fades.

Back

This is an example of Hedonic Adaptation

Front

The fear of missing out, or FOMO, is...

Back

The anxiety that an interesting or exciting event is happening without you