lecture 2 Flashcards
1
Q
What is the difference between decision-making and rational choice?
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2
Q
What is menu dependence?
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3
Q
What should rationally happen when menu is expanded? what is the expansion condition?
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4
Q
What is the decoy effect? How can you rapresent it?
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5
Q
What is WTP and WTA? show them matematically and graphically
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6
Q
What it the endowment effect?
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7
Q
How is the value fucntion useful? What characteristics does it embodies?
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8
Q
How does change in reference point shift utility? show it graphically
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9
Q
What application does loss aversion have?
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10
Q
What is loss aversion?
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11
Q
What decision would a rational actor take regarding opportunity cost?
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12
Q
What is opportunity cost neglect? what are some applications)
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13
Q
What is the sunk cost fallacy? What are some examples?
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