Vocabulary
Life Values
Scenarios
Social Media
Short Answer
100

A subconscious error in thinking that leads to irrational decision making

Cognitive Bias

100

Our personal identity (how we see ourselves) and our social identity (how we believe others see us)

Inner Values

100

Which of the following scenarios BEST demonstrates FOMO (Fear of Missing Out)?

  1. Megan takes a baking class after seeing a sign for the class at her favorite bakery
  2. David goes on a vacation to Europe and posts about it on social media every day
  3. Angela sees an advertisement for a pair of shoes and decides to buy them
  4. José wants to go see a movie that all of his friends have seen and are raving about
  • José wants to go see a movie that all of his friends have seen and are raving about
100

Overconfidence bias may lead the majority of Americans to think that they are…

  1. Above average drivers
  2. Average drivers  
  3. Below average drivers 
  4. Extremely poor drivers  
  • Above average drivers
200

The tendency to put more value on things you already own

Endowment Effect

200

Our desire for belonging and relatedness with our family members, neighbors, friends, coworkers, and communities

Social Values

200

After learning about hedonic adaptation, Tamara wants to spend her money more wisely. Which of the following might help her do so?  

  1. Purchasing a dress after seeing an ad on social media
  2. Buying a new laptop even though her current one still works well
  3. Donating money to a charity that supports a cause she cares about
  4. Getting a new phone accessory for her phone case
  • Donating money to a charity that supports a cause she cares about
200

You are doing research on a new electric car that you are interested in buying.  You only visit the car company’s website and an online message board of electric car enthusiasts to do your research.  This strategy may lead to …

  1. Herd mentality
  2. The endowment effect
  3. Confirmation bias
  4. Loss aversion
  • Confirmation bias
300

The tendency to feel anxiety/fear that an exciting or interesting event may currently be happening elsewhere, often aroused by posts seen on a social media website

The Fear of Missing Out 

300

The tangible aspects of life, the external world, our physical health, and well-being

Physical Values

300

Sebastian began day trading stocks at the beginning of the summer.  After a month, he made a profit of $200. Due to his short term success and his belief that he is a highly skilled trader, Sebastian puts his entire savings into the market.  This is an example of…

  1. Overconfidence Bias
  2. The Fear of Missing Out (FOMO)
  3. Confirmation Bias
  4. The Endowment Effect
  • Overconfidence Bias
300

You spend an entire Saturday going to car dealerships in search of a used car. You spend hours looking at cars and even test drive a few, but there are none you like that fit your budget. What is the sunk cost you should ignore when deciding whether or not to buy a car that day?

  1. The cost of the car
  2. The cost of the warranty
  3. The time it will take to drive home
  4. The time you spent looking for cars that day
  • The time you spent looking for cars that day
400

The use of social media platforms and websites to promote a product or service

Social Media Marketing

400

Unrelated to how much money we actually have, these values reflect what we think or believe about money

Financial Values

400

Michael observed he felt the pain of losing a $20 bill more than he felt the joy of finding it on the sidewalk the week before. This is a result of...

  1. Endowment effect
  2. Loss aversion
  3. Sunk cost
  4. Overconfidence
  • Loss aversion
400

A website tells you, "Only one left!" while shopping online. Which loss aversion strategy is this website using?

  1. Coupons
  2. Scarcity and urgency
  3. Buy now, get free shipping
  4. Free trials and samples
  • Scarcity and urgency
500

Costs that have already been incurred and cannot be recovered

Sunk Cost

500

What are the four life values

Inner, social, physical, financial


500

Imagine two scenarios:

  • Scenario 1: You see a rare sports card being sold for $500 in a store but choose not to buy it because you think it’s too expensive.
  • Scenario 2: You find a rare sports card worth $500 in your parents’ attic. Rather than sell it, you choose to put it in a case and display it in your room.

In scenario 1, you are putting more value on your $500 than the card. In scenario 2, you are putting more value on your card than the $500. This is an example of what?

  1. The Fear of Missing Out (FOMO)
  2. Overconfidence
  3. Endowment effect
  4. Confirmation bias
  • Endowment effect
500

When using social media, it's important to remember that...

  1. Social media ads are trying to get you to buy stuff you NEED, not want
  2. Marketers have your best interests in mind and want you to be financially responsible
  3. People typically only post about the best parts of their lives on social media
  4. The more likes a post has, the more trustworthy and accurate the information is likely to be
  • People typically only post about the best parts of their lives on social media
500

What role does social media play in creating FOMO?

FOMO, or the fear of missing out, is often brought on by social media because you can easily see what other people in your community are doing when you’re not with them. Seeing these posts can make you feel like you’re missing out on an event or experience and cause you to feel worse about what is happening in your own life.

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