The ________ Is the Tendency for People's Choices to Be

question 145

Multiple Choice

The ________ is the tendency for people's choices to be affected by how a choice is presented, such as whether it is worded in terms of potential losses or gains.

• A) availability heuristic
• B) affect heuristic
• C) hindsight bias
• D) framing effect

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Definitions:

Reserves

Reserves refer to funds or other assets that banks or financial institutions hold to meet unexpected demands or regulatory requirements.

Required Reserve Ratio

A regulation set by central banks determining the minimum amount of reserves that banks must hold against deposits, affecting money supply.

Excess Reserves

The reserves that banks hold over and above the legal requirement; these are not loaned out and do not earn interest for the bank.

Required Reserves

The minimum amount of funds that a bank must hold in reserve against deposits, as mandated by the central bank.