ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
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Normative theories predict that people should always choose certain options in gambling problems, but ____ theory explains why they do not always follow the normative theories dictate that they should.
1. Expected utility
2. Heuristic
3. Prospect
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- 9. Behavioral economics Indicate whether each of the following examples of behavior is consistent with the way the traditional economic framework suggests people should act, or whether it is reserved for behavioral economists to examine. Behavior There are people who pursue a degree in dance rather than informatics, even though high-tech careers are usually much higher-paying. Some people care more about how much money they make relative to others in their social network rather than their absolute income level. Some people treat $60 they earn differently from $60 they win playing powerball. People at all-you-can-eat restaurants eventually leave, even though they could continue eating for free. Consistent with Traditional Economic Model predictions Exclusive to Behavioral Economic theoryarrow_forward2) Explain how utility could be used in a decision where performance is not measuredby monetary value.arrow_forward9) A new area of economics studies situations in which people appear to be making choices that do not appear to be economically rational. This area is called behavioral economics social economics new wave economics. irrational economicsarrow_forward
- 8. After the attentive stage, customers become aware of the product and require a more challenging step in order to gain their _________________. At this stage consumers develop preference and are seriously considering purchasing the product eventually. * A. Attention B. Interest C. Desire D. Action E. None of the abovearrow_forwardWhat happens when individual consumers don't have perfect information nor limitations to process information to make a decision? a) They tend to think rationally b) They are more affected by biases c) They put into more search to find proper information d) They don't make a decisionarrow_forward4arrow_forward
- please helparrow_forwardDiminishing marginal utility occurs because: Wählen Sie eine Antwort: The more you have, the less total satisfaction you get, up to the point where your satisfaction begins to increase again You become addicted to the product You like the product the more you have it You get tired of the product xarrow_forwardmake sure to include the formulas (to solve the problems), the steps of your calculations, and the explanation of your answers.arrow_forward
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