Unit 1: Behavioral Economics vocabulary review

What is the name of the bias where people tend to search for, interpret, and remember information that confirms their preconceptions?

• Endowment Effect

• Overconfidence Bias

• Confirmation Bias

Which term refers to the tendency for people to stick with decisions because they have already invested resources, even if it is not the best choice?

• Sunk Cost Fallacy

• Hedonic Adaptation

• Confirmation Bias

What is the effect called when people value things more highly simply because they own them?

• Endowment Effect

• Overprecision

• Overestimation

Which concept describes the process of becoming used to a stimulus, leading to reduced emotional response over time?

• Sunk Costs

• Hedonic Adaption

• Confirmation Bias

Which term refers to the tendency to believe that one's own performance is better than that of others?

• Overnight Test

• Overprecision

• Overplacement

What is the name of the bias where people are excessively certain about the accuracy of their beliefs or predictions?

• Overprecision

• Cognitive Bias

• Herd Mentality

Which term is used for the general tendency to make errors in thinking or judgment?

• Loss Aversion

• Cognitive Bias

• Sunk Costs

What is the name of the test that involves waiting overnight before making a final decision?

• Overnight Test

• Endowment Effect

• Hedonic Adaptation

Which term refers to the use of online platforms to promote products or services?

• Herd Mentality

• Social Media Marketing

• Sunk Cost Fallacy

Which subfield of economics applies psychological insights into human behavior to explain economic decision making?

• Classical Economics

• Behavioral Economics

• Microeconomics