Daily Work Quiz #1 (1.1-1.2)

Naresh started a new job and is having some of his paycheck deposited directly into a savings account. Which of the following values BEST explains why Naresh does this on a regular basis?

• Inner

• Social

• Physical

• Financial 

You overhear your friend Ginny say, "I made a budget for myself in my personal finance class and used my values to decide how I want to use my money." What does Ginny mean by this?

• Ginny used the value of her bank account balance to decide how to use her money

• Ginny asked her friends and family for advice to decide how to use her money

• Ginny followed recommendations she saw on social media to decide how to use her money

• Ginny identified what is important to her and used that knowledge to decide how to use her money

What are social values, as they pertain to money?

• How you, personally, care and think about finances

• How your family, friends, and community members impact your feelings about money

• How companies and advertisement make you feel about money

• How banks and other financial institutions treat you and your money

Behavioral economics…

• Is a field of economics that studies people who make rational and objective decisions

• Analyzes how different economies around the world behave over time

• Tracks and examines stock market trends over a certain period of time

• Combines economics and psychology to study why people behave the way they do in the real world

Cognitive bias is…

• An error in the way we think that can influence our decisions

• The desire to seek out information that confirms our existing beliefs

• The belief that our abilities are better than they actually are

• The concept of placing more value on an item when we own it

You go to a restaurant and order a big meal. Even though you’re full, you keep eating because it was expensive. This is an example of...

• Mental Accounting

• Sunk Cost

• Fear of Missing Out

• The Endowment Effect