Personal Finance Unit 1 Vocab

Behavioral Economics is The subfield of economics that applies psychological insights into human behavior and to explain economic decision making

• False

• True

Cognitive Bias is The tendency to put more value on things you already own

• True

• False

Confirmation Bias - The tendency to search for information that supports our preconceptions and to ignore or distort contradictory evidence

• True

• False

Endowment Effect - The tendency to feel anxiety/fear that an exciting or interesting event may currently be happening elsewhere, often aroused by posts seen on a social media website

• False

• True

What does FOMO stand for

• Fear Of Making Objects

• Fear of missing On

• Forever On My Own

• Fear of missing out

Hedonic Adaptation - The tendency to return to a baseline level of happiness regardless of whether you go through a positive or negative experience or event

• True

• False

Herd Mentality - tendency to conform to the behaviors and beliefs of the people around you

• True

• False

Loss Aversion -

The tendency to regard losses as considerably more important than gains of comparable magnitude

• False

• True

Overconfidence Bias

The tendency people have to be more confident in their own abilities

• True

• False

Overestimation -

When a person believes they are better at something than they actually are

• True

• False

• I have no clue

• I didn't studey