Asking Someone to Quantify How Much He or She Would

question 16

Multiple Choice

Asking someone to quantify how much he or she would benefit from a new highway is an example of:

• A) contingent valuation.
• B) revealed preference valuation.
• C) cost-benefit analysis.
• D) social discounting.

---

Definitions:

Prospect Theory

A behavioral economic theory that suggests individuals value gains and losses differently, leading to decisions that can deviate from traditional economic predictions which assume rational behavior.

Behavioral Economics

A field of economics that studies how psychological, cognitive, emotional, cultural, and social factors affect the economic decisions of individuals and institutions.

High Upfront Costs

High Upfront Costs are significant initial expenses incurred before a project, investment, or purchase begins to generate any revenues or savings, often acting as a barrier to entry.

Behavioral Economics

A field of economics that examines how psychological, cognitive, emotional, cultural, and social factors influence the economic decisions of individuals and institutions.