Assume That the Quantity of CDs Is Measured on the Horizontal

question 25

Multiple Choice

Assume that the quantity of CDs is measured on the horizontal axis, while the quantity of movie tickets is measured on the vertical axis. If available income decreases, then the new budget line:

• A) will have a smaller horizontal intercept, while keeping the same vertical intercept.
• B) will have a smaller vertical intercept, while keeping the same horizontal intercept.
• C) will have a smaller vertical and horizontal intercept.
• D) will have a bigger vertical and horizontal intercept.

Recognize how behavioral economics explains the influence of cognitive biases and heuristics on decision making.

Identify the factors affecting human decision making, including the impact of framing, temptation, and future versus present preferences.

Understand the concept of "bounded rationality" and its significance in behavioral economics.

Examine the role of external factors, such as store layout and advertisement, on consumer behavior from a behavioral economics perspective.

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Definitions:

Calorie Intake

The quantity of energy consumed from foods and beverages by an individual in a given time period.

Treadmill

is an exercise machine that allows one to walk or run while staying in the same place, often used for fitness, therapy, or cardiac health evaluations.

Narcissistic Personality Disorder

A mental condition characterized by a long-term pattern of exaggerated self-importance, the need for excessive attention and admiration, troubled relationships, and a lack of empathy for others.

Diagnosed

The identification of the nature and cause of an illness or other problem through the examination of symptoms.