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Unit 1: Behavioral Economics vocabulary review

Total questions: 15

Worksheet time: 11mins

Name
Class
Date
1.

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

a)

Endowment Effect

b)

Overconfidence Bias

c)

Confirmation Bias

2.

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?

a)

Sunk Cost Fallacy

b)

Hedonic Adaptation

c)

Confirmation Bias

3.

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

a)

Endowment Effect

b)

Overprecision

c)

Overestimation

4.

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

a)

Sunk Costs

b)

Hedonic Adaption

c)

Confirmation Bias

5.

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

a)

Overnight Test

b)

Overprecision

c)

Overplacement

6.

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

a)

Overprecision

b)

Cognitive Bias

c)

Herd Mentality

7.

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

a)

Loss Aversion

b)

Cognitive Bias

c)

Sunk Costs

8.

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

a)

Overnight Test

b)

Endowment Effect

c)

Hedonic Adaptation

9.

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

a)

Herd Mentality

b)

Social Media Marketing

c)

Sunk Cost Fallacy

10.

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

a)

Classical Economics

b)

Behavioral Economics

c)

Microeconomics

11.

When a person has an exaggerated certainty that an answer is correct, what is this called?

a)

Fool proof

b)

Loss aversion

c)

Overconfidence Bias

12.

What is it called when a person mistakenly believes they are better than others?

a)

Sunk cost fallacy

b)

Confirmation bias

c)

Overplacement

13.

Which strategy is used to combat loss aversion by imagining that overnight something you own has been replaced with cash, then determining whether you would prefer to keep the cash or buy the item back?

a)

Hedonic adaptation

b)

Overnight Test

c)

The cash replacement strategy

14.

What is the tendency to return to a baseline level of happiness regardless of whether you go through a positive or negative experience or event?

a)

Hedonic adaptation

b)

Loss aversion

c)

Endowment effect

15.

What is the use of social media platforms and websites to promote a product or service called?

a)

Behavioral economics

b)

Social media marketing

c)

Loss aversion