Microeconomics (9th Edition) (Pearson Series in Economics)
9th Edition
ISBN: 9780134184890
Author: PINDYCK
Publisher: PEARSON
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Chapter 19, Problem 7E
To determine
The knowledge of behavioural economics and public policy to analyse the pros and cons of an attic clearing program
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Behavioral economics has been around for a while but it is experiencing a new resurgence.
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Microeconomics (9th Edition) (Pearson Series in Economics)
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- Explain two or more of the behavioral economics concepts listed below and give an example of each Response Parameters Perhaps you can provide a link to a graphic or a video that enhances your discussion. Concepts: Confirmation bias, overconfidence effect, hindsight bias, availability heuristic, planning fallacy, framing effects, anchoring, endowment effect, status quo effectarrow_forwardVictoria founded a start-up several years ago, together with her Macedonian friends. At first, she was fairly poor and therefore very afraid of taking risks. Any negative shock could send the company into bankruptcy. Nowadays her business is thriving, stretching across several markets from Europe to Asia. Victoria no longer worries about taking monetary risks. In fact she enjoys a good gamble over horse races from time to time. How would you draw Victoria's utility function in a way that describes her changing taste for risk as her wealth increased? Please draw a graph and comment. Please do fast ASAP fastarrow_forwardDo you believe in the principles of behavioral economics as the new way to guide economic thought and theory or are the fundamentals of traditional economics(eg. Efficient Markets Hypothesis) a necessary baseline which enables us to then understand deviations from rationality? Why? Give two examples of both real-life irrationality (behavioral economics) and rationality (traditional economics).arrow_forward
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