WorksheetsUnderstanding Biases in Financial Decisions
Total questions: 8
Worksheet time: 4mins
Which of the following defines a bias?
A choice made about spending money.
A healthy debate about preferences.
A preference based on unreasoned judgement.
A summary of someone's financial performance.
Overconfidence is an example of:
a personal preference.
a cognitive bias.
an experiential bias.
a financial bias.
What percentage of Gen Z believes they'll achieve a higher standard of living than their parents?
10%
Which of the following describes the bias known as mental accounting?
Choosing the first or default option
Thinking of your money in different buckets
Not having a written budget
Using professional accounting strategies for your money
What is one example of mental accounting?
Using money someone gifted you to treat yourself
Using money someone gifted you to repair your car
Using money someone gifted you to pay student loans
Using money someone gifted you to pay a utility bill
Which of the following is an example of a cognitive bias affecting financial decisions?
Ignoring sunk costs when making a purchase
Saving a fixed percentage of your income
Spending more when using a credit card instead of cash
Comparing prices before buying
What does the term 'mental accounting' refer to in personal finance?
Hiring a professional accountant
Investing only in stocks
Separating money into categories based on its source or intended use
Tracking all expenses in a spreadsheet
Which of the following best illustrates the impact of bias on financial behavior?
Consulting a financial advisor for advice
Reviewing multiple investment options before deciding
Choosing to invest in a company because a friend recommended it, without research
Setting up automatic savings transfers
