Budgeting May Use Nonfinancial Terms

question 22

True/False

Budgeting may use nonfinancial terms.

---

Definitions:

Endowment Effect

The phenomenon where individuals value an owned object higher than they would if they did not own it.

Raffle Prize

A reward given to a randomly selected participant in a raffle, where people enter by purchasing tickets for a chance to win.

Myopia

Refers to the difficulty human beings have with conceptualizing the more distant future. Leads to decisions that overly favor present and near-term options at the expense of more distant future possibilities.

Behavioral Economists

Specialists who study the effects of psychological, cognitive, emotional, cultural, and social factors on the economic decisions of individuals and institutions.