Nudge Explained!

What is the core concept of a "nudge"?

• A change to the environment that pushes people to make better decisions for themselves.

• A direct command that forces individuals to choose a specific option.

• A psychological flaw that prevents people from making rational choices.

• A marketing strategy to increase sales of products at eye level.

The "eye level is buy level" strategy in supermarkets works because of which psychological tendency?

• People are more likely to choose items that are cheaper.

• People are more likely to choose items that are easier to see and reach.

• People prefer items with attractive packaging.

• People tend to buy items they have seen advertised recently.

In a fundraising study, when people were asked to donate $400, the average donation was $143. When asked to donate $5, the average donation was $20. This phenomenon demonstrates which bias?

• Availability Bias

• Representativeness Heuristic

• Anchoring Bias

• Confirmation Bias

Why do sales of earthquake insurance often surge immediately after a major earthquake, even if the actual frequency of earthquakes hasn't increased?

• People believe the government will offer subsidies for insurance after a disaster.

• The recent memory of an earthquake makes people overestimate the likelihood of another one.

• Insurance companies offer special discounts after a natural disaster.

• People are more likely to buy insurance when they see their neighbors doing so.

The "Linda problem" illustrates a cognitive bias where people judge the probability of an event based on how well it matches a prototype, rather than on statistical likelihood. What is this bias called?

• Availability heuristic

• Representativeness heuristic

• Anchoring bias

• Confirmation bias

Which nudge tactic involves pre-selecting an option for individuals, requiring them to actively choose to change it if they prefer a different option?

• Narrowing the field

• Defaults

• Providing incentives

• Social proof

When faced with an overwhelming number of choices, which nudge tactic helps individuals make better decisions by reducing the complexity and quantity of options presented?

• Defaults

• Framing

• Narrowing the field

• Priming

The authors of the book "Nudge" describe their ethical approach to guiding people's choices without restricting their freedom as what?

• Behavioral economics

• Choice architecture

• Libertarian paternalism

• Cognitive restructuring