Question 1

Economic science tries to design mechanisms to coordinate people's actions better.

Accepted Answer

A) True 
 B)False

Question 2

Paternalism leads people to:

Accepted Answer

A) make decisions that are good for themselves that they might not have made on their own. 
B) consider what their parents would do when making decisions even though they themselves might not make those same decisions. 
C) buy only what they need instead of what they want because doing otherwise is bad environmental stewardship. 
D) use their abilities as well as possible and purchase only what they need regardless of price. 
A) make decisions that are good for themselves that they might not have made on their own. 
B) consider what their parents would do when making decisions even though they themselves might not make those same decisions. 
C) buy only what they need instead of what they want because doing otherwise is bad environmental stewardship. 
D) use their abilities as well as possible and purchase only what they need regardless of price.

Question 3

Behavioral economists and traditional economists both believe that everything matters.

Accepted Answer

A) True 
 B)False

Question 4

Only money prices affect incentives; shadow prices do not.

Accepted Answer

A) True 
 B)False

Question 5

What is an informational nudge? Give an example.

Accepted Answer

An informational nudge is one where info

Question 6

Traditional economists say that having more makes you happier;what do behavioral economists say?

Accepted Answer

Some behavioral economists say

Question 7

If the RECAP policy was imposed on firms by the government, it would be considered a(n):

Accepted Answer

A) shadow price. 
B) advantageous default option nudge. 
C) push. 
D) purposeful behavior. 
A) shadow price. 
B) advantageous default option nudge. 
C) push. 
D) purposeful behavior.

Question 8

If the government were to put policies in place to regulate carbon emissions from factories, such a policy would be a:

Accepted Answer

A) nudge. 
B) tariff. 
C) lobby. 
D) push. 
A) nudge. 
B) tariff. 
C) lobby. 
D) push.

Question 9

Nudges can be used by:

Accepted Answer

A) firms only. 
B) firms, but only as a last resort. 
C) firms and government. 
D) government only. 
A) firms only. 
B) firms, but only as a last resort. 
C) firms and government. 
D) government only.

Question 10

What is a default option nudge? Give an example.

Accepted Answer

A default option nudge is one that takes

Question 11

Among economists, a basic economic policy debate regarding markets is:

Accepted Answer

A) whether markets ought to have prices. 
B) whether to let economic forces exist. 
C) what data is available for a model given institutions. 
D) what coordinating mechanism will best solve a specific problem. 
A) whether markets ought to have prices. 
B) whether to let economic forces exist. 
C) what data is available for a model given institutions. 
D) what coordinating mechanism will best solve a specific problem.

Question 12

Advocates of nudge policy argue that these policies are libertarian because they:

Accepted Answer

A) enhance happiness and therefore liberty. 
B) leave people free to make their own choices. 
C) correct market distortions. 
D) change incentives without forcing people to make particular decisions. 
A) enhance happiness and therefore liberty. 
B) leave people free to make their own choices. 
C) correct market distortions. 
D) change incentives without forcing people to make particular decisions.

Question 13

Why are decisions that have many dimensions difficult to make? Can you give an example?

Accepted Answer

Decisions that have many dimensions are

Question 14

What is a coordinating mechanism? Give a couple of examples.

Accepted Answer

A coordinating mechanism is a method for

Question 15

Which question is typically asked by economic engineers?

Accepted Answer

A) Can we assume that people always behave rationally? 
B) Can we increase the amount of mathematics in the model? 
C) Can we design mechanisms to improve the coordination of people's actions? 
D) Can we rely on the markets to distribute income fairly? 
A) Can we assume that people always behave rationally? 
B) Can we increase the amount of mathematics in the model? 
C) Can we design mechanisms to improve the coordination of people's actions? 
D) Can we rely on the markets to distribute income fairly?

Question 16

To have shadow prices you have to have:

Accepted Answer

A) opportunity costs. 
B) money prices. 
C) free markets. 
D) laws. 
A) opportunity costs. 
B) money prices. 
C) free markets. 
D) laws.

Question 17

If government requires a firm to implement a nudge, the government's action is not a nudge.

Accepted Answer

A) True 
 B)False

Question 18

What is a nudge?

Accepted Answer

A nudge is the deliberate desi

Question 19

A deliberate design within the choice architecture that alters people's behavior in predictably positive ways is called an example of:

Accepted Answer

A) a push. 
B) a nudge. 
C) purposeful behavior. 
D) traditional behavior. 
A) a push. 
B) a nudge. 
C) purposeful behavior. 
D) traditional behavior.

Question 20

Behavioral economic policy examines:

Accepted Answer

A) the level of mathematics required to make sound judgments. 
B) people's unpredictable irrational behavior. 
C) people's predictable irrational behavior. 
D) people's rational behavior. 
A) the level of mathematics required to make sound judgments. 
B) people's unpredictable irrational behavior. 
C) people's predictable irrational behavior. 
D) people's rational behavior.

Exam 22: Behavioral Economics and Modern Economic Policy

Economic science tries to design mechanisms to coordinate people's actions better.

Paternalism leads people to:

Behavioral economists and traditional economists both believe that everything matters.

Only money prices affect incentives; shadow prices do not.

What is an informational nudge? Give an example.

Traditional economists say that having more makes you happier;what do behavioral economists say?

If the RECAP policy was imposed on firms by the government, it would be considered a(n):

If the government were to put policies in place to regulate carbon emissions from factories, such a policy would be a:

Nudges can be used by:

What is a default option nudge? Give an example.

Among economists, a basic economic policy debate regarding markets is:

Advocates of nudge policy argue that these policies are libertarian because they:

Why are decisions that have many dimensions difficult to make? Can you give an example?

What is a coordinating mechanism? Give a couple of examples.

Which question is typically asked by economic engineers?

To have shadow prices you have to have:

If government requires a firm to implement a nudge, the government's action is not a nudge.

What is a nudge?

A deliberate design within the choice architecture that alters people's behavior in predictably positive ways is called an example of:

Behavioral economic policy examines:

Economics and Economic Reasoning

The Production Possibility Model, Trade, and Globalization

Economic Institutions

Supply and Demand

Using Supply and Demand

Describing Supply and Demand: Elasticities

Taxation and Government Intervention

Market Failure Versus Government Failure

Comparative Advantage, Exchange Rates, and Globalization

International Trade Policy

Production and Cost Analysis I

Production and Cost Analysis II

Perfect Competition

Monopoly and Monopolistic Competition

Oligopoly and Antitrust Policy

Real-World Competition and Technology

Work and the Labor Market

Who Gets What the Distribution of Income

The Logic of Individual Choice: the Foundation of Supply and Demand

Game Theory, Strategic Decision Making, and Behavioral Economics

Thinking Like a Modern Economist

Microeconomic Policy, Economic Reasoning, and Beyond

Economic Growth, Business Cycles, and Unemployment

Measuring and Describing the Aggregate Economy

The Keynesian Short-Run Policy Model: Demand-Side Policies

The Classical Long-Run Policy Model: Growth and Supply-Side Policies

The Financial Sector and the Economy

Monetary Policy

Financial Crises, Panics, and Unconventional Monetary Policy

Deficits and Debt: the Austerity Debate

The Fiscal Policy Dilemma

Jobs and Unemployment

Inflation, Deflation, and Macro Policy

International Financial Policy

Macro Policy in a Global Setting

Structural Stagnation and Globalization

Macro Policy in Developing Countries

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