Behavioral Economic Policy Is Likely To

question 28

Multiple Choice

Behavioral economic policy is likely to:

• A) suggest no government involvement.
• B) be based on the assumption of rationality.
• C) assume that the way choices are presented doesn't affect the decision made.
• D) take into account people's predictably irrational behavior.

---

Definitions:

Adverse Selection

This occurs when there is a lack of symmetric information prior to a deal, leading parties with higher risk to be more likely to engage in an agreement, notably impacting insurance and finance markets.

Reckless Drivers

Individuals who operate vehicles in a careless or heedless manner without regard for the rules of the road or the safety of others.

Safety Devices

Tools or technologies designed to prevent accidents, injuries, or other hazardous outcomes in various environments.

Screen

To evaluate or assess something or someone in order to make a decision, often used in contexts like employment, investment, or healthcare.