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WorksheetsUnit 1: Behavioral Economics
Total questions: 18
Worksheet time: 9mins
Name
Class
Date
1.
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?
a)
Inner
b)
Social
c)
Physical
d)
Financial
2.
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?
a)
Ginny used the value of her bank account balance to decide how to use her money
b)
Ginny asked her friends and family for advice to decide how to use her money
c)
Ginny identified what is important to her and used that knowledge to decide how to use her money
d)
Ginny followed recommendations she saw on social media to decide how to use her money
3.
What are social values, as they pertain to money?
a)
How you, personally, care and think about finances
b)
How your family, friends, and community members impact your feelings about money
c)
How companies and advertisement make you feel about money
d)
How banks and other financial institutions treat you and your money
4.
Behavioral economics…
a)
Is a field of economics that studies people who make rational and objective decisions
b)
Analyzes how different economies around the world behave over time
c)
Tracks and examines stock market trends over a certain period of time
d)
Combines economics and psychology to study why people behave the way they do in the real world
5.
Cognitive Bias is...
a)
a. An error in the way we think that can influence our decisions
b)
b. The desire to seek out information that confirms our existing beliefs
c)
c. The belief that our abilities are better than they actually are
d)
d. The concept of placing more value on an item when we own it
6.
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...
a)
a. Mental Accounting
b)
b. The Sunk Cost Fallacy
c)
c. Fear of Missing Out
d)
d. The Endowment Effect
7.
Which of the following is TRUE about cognitive biases?
a)
It is easy to recognize when cognitive biases are influencing our own decisions
b)
There is rarely anything you can do to combat a cognitive bias’ influence
c)
There are only a handful of cognitive biases that exist
d)
Awareness is often the first step to overcoming the influence of a cognitive bias
8.
Andrew wants to buy a specific model of a new car. He conducts research and finds many resources that highlight the benefits of that car model. Which cognitive bias might be influencing Andrew’s decision making?
a)
Confirmation Bias
b)
Hedonic Adaptation
c)
The Sunk Cost Fallacy
d)
Overconfidence
9.
Mina wants to start using an investment app that all of her friends are raving about. She hasn’t done any research on the app, but she trusts her friends’ judgment. At home, Mina’s mom points out that Mina is being influenced by FOMO and herd mentality. All of the following are things Mina can do to overcome these cognitive biases EXCEPT…
a)
Take time to reflect and identify why she is so eager to use the app
b)
Watch a positive video about the app, download the app, and start using it that day
c)
Ask people outside her friend group for their opinions and perspectives
d)
Seek out reviews that talk about the disadvantages of using the app
10.
How do behavioral economists view people differently than traditional economists?
a)
Behavioral economists believe people always make rational decisions based on self-interest.
b)
Behavioral economists consider people as consistently making decisions that maximize economic outcomes.
c)
Behavioral economists acknowledge that people make predictable mistakes.
d)
Behavioral economists think people are solely driven by external factors alone.
11.
Which of the following is NOT a sign of cognitive bias?
a)
Making decisions based on a thorough evaluation of the evidence
b)
Attributing other people’s success to luck
c)
Constantly blaming others if things don’t go your way
d)
Assuming you are always correct
12.
What life value reflects the following statement?
- Strong physical values might translate to overspending on material possessions if left unchecked, but could also show up in our desire for quality.
- This person is willing to spend more for craftsmanship and design.
a)
Inner
b)
Social
c)
Physical
d)
Financial
13.
What life value reflects the following statement?
- Think more about the sustainability of their money and generally have more in reserve.
- Tend to be prepared for financial emergencies.
a)
Inner
b)
Social
c)
Physical
d)
Financial
14.
The tendency to search for information that supports our preconceptions and to ignore or distort contradictory evidence
a)
Herd Mentality
b)
Confirmation Bias
c)
Sunk Cost Fallacy
d)
Endowment Effect
e)
FOMO
15.
The tendency to put more value on things you already own.
a)
Herd Mentality
b)
Confirmation Bias
c)
Sunk Cost Fallacy
d)
Endowment Effect
e)
FOMO
16.
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.
a)
Herd Mentality
b)
Confirmation Bias
c)
Sunk Cost Fallacy
d)
Endowment Effect
e)
FOMO
17.
The tendency to conform to the behaviors and beliefs of the people around you.
a)
Herd Mentality
b)
Confirmation Bias
c)
Sunk Cost Fallacy
d)
Endowment Effect
e)
FOMO
18.
The tendency to make decisions about a current situation based on what resources you have already invested in the situation.
a)
Herd Mentality
b)
Confirmation Bias
c)
Sunk Cost Fallacy
d)
Endowment Effect
e)
FOMO
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