Question 1

Commitment devices can be:
A)a way to use choice architecture to help you avoid temptation.
B)formal policies or products.
C)a way for people to voluntarily restrict their choices in order to make it easier to stick to plans.
D)All of these statements are true.

Accepted Answer

All of these statements are true. Commitment devices are ways to help individuals stick to their plans by using choice architecture, formal policies, or products to restrict their choices and avoid temptation. They are voluntary and can be effective in promoting self-control and achieving long-term goals.

Question 2

A person committing to carpool with a friend to the gym for daily workouts is an example of:
A)a commitment device.
B)status quo bias.
C)the endowment effect.
D)positive framing.

Accepted Answer

The person committing to carpool with a friend to the gym is using a commitment device to help them stick to their goal of daily workouts. A commitment device is a strategy used to help individuals overcome their tendency to procrastinate or deviate from their intended behavior. By agreeing to carpool with someone, the person is making it more difficult to back out of their workout routine and increasing their chances of success.

Question 3

Susie doesn't buy ice cream this week at the grocery store because she intends to start a diet in a few days.Her behavior is an example of:
A)a commitment device.
B)status quo bias.
C)the endowment effect.
D)positive framing.

Accepted Answer

The answer of Susie doesn't buy ice cream this week...

Question 4

A store is choosing between advertising a credit card fee or a discount for paying cash to its customers.More customers are likely to pay cash if the store owner advertises:
A)the credit card fee.
B)the discount for paying cash.
C)either one;since it's the same outcome,people won't care one way or another.
D)neither one;since people are not likely to pay cash more regardless of how it's advertised.

Accepted Answer

The answer of A store is choosing between advertising a...

Question 5

The Save More Tomorrow (SMarT)program is an example of a:
A)weak commitment device that was successful.
B)strong commitment device that was successful.
C)weak commitment device that was unsuccessful.
D)strong commitment device that was unsuccessful.

Accepted Answer

The answer of The Save More Tomorrow (SMarT)program is an...

Question 6

Amanda is from Vermont and visiting California for the first time.At home,Amanda always goes jogging early in the morning because it's hottest in the early afternoon.Not knowing what to expect of the weather in California,she decides to go jogging in the early morning during her visit.This decision is an example of:
A)loss aversion.
B)status quo bias.
C)a heuristic.
D)positive framing.

Accepted Answer

The answer of Amanda is from Vermont and visiting California...

Question 7

Suppose you were asked,"Can you guess the height of the tallest living man? Is it more than 8 feet?" When people suggest an answer in the question they ask,it is a form of:
A)anchoring.
B)rule of thumb.
C)time inconsistency.
D)positive framing.

Accepted Answer

This is an example of anchoring, where the question itself suggests a reference point (8 feet) that may influence the respondent's estimate of the tallest living man's height.

Question 8

An example of a heuristic is:
A)a rule of thumb.
B)predatory lending.
C)common sense.
D)All of these are heuristics.

Accepted Answer

A heuristic is defined as a mental shortcut or rule of thumb that allows an individual to make quick judgments based on limited information. Choice A accurately describes this definition, while the other choices do not fit the definition of a heuristic.

Question 9

John is buying a scented candle for his girlfriend.John thinks about her flower-scented perfume,flower-scented air spray,and flower-scented shampoo.He decides to buy her a flower-scented candle.His behavior is:
A)using a heuristic called a rule of thumb.
B)an example of the endowment effect because she already has flower-scented goods.
C)an example of loss aversion because he doesn't want to make the wrong choice.
D)an example of status quo bias because he doesn't want to deviate from her normal choice of scent.

Accepted Answer

John is using a heuristic called a rule of thumb because he is simplifying the decision-making process by using the information that is most readily available to him (her previous use of flower-scented products) to make a choice about which candle to buy.

Question 10

Commitment devices:
A)need strong commitments that are hard to get out of in order to be successful.
B)are never strong commitments that are hard to get out of.
C)can be successful whether they have strong or weak commitments.
D)are only successful if they are weak commitments that are easy to change.

Accepted Answer

The answer of Commitment devices:
A)need strong commitments that are hard...

Question 11

A person cutting up their credit cards in an effort to curb their spending is an example of:
A)a commitment device.
B)status quo bias.
C)the endowment effect.
D)loss aversion.

Accepted Answer

The act of cutting up credit cards is a commitment device, as it is a strategy used to limit impulsive spending by making it harder to access credit.

Question 12

Suggested donations on fundraising items sent to you in the mail is an example of:
A)loss aversion.
B)positive framing.
C)rule of thumb.
D)anchoring.

Accepted Answer

Anchoring refers to the cognitive bias where individuals rely heavily on an initial piece of information (the "anchor") when making decisions. Suggested donations serve as an anchor, influencing the amount people consider donating.

Question 13

A heuristic is:
A)a mental shortcut that helps us make decisions.
B)a positive-framing method.
C)a method to increase the price of your vices.
D)None of these statements is true.

Accepted Answer

A heuristic is a mental shortcut or a rule of thumb that helps in solving problems, making judgments, or making decisions quickly and efficiently. It may not always be accurate or reliable, but it helps simplify complex situations and allows us to make decisions based on limited information or experience.

Question 14

Commitment devices can be:
A)a tool to help people avoid temptation.
B)an informal arrangement.
C)formal policies set up through an employer or third party.
D)All of these statements are true.

Accepted Answer

All of these statements are true. Commitment devices can take different forms, including personal tools (such as setting a savings goal with a friend), informal arrangements (such as a couple agreeing to limit their spending), or formal policies set up through an employer or third party (such as a gym offering discounts for regular attendance). The common feature of commitment devices is that they aim to help people overcome self-control problems and stick to their long-term goals.

Question 15

In terms of framing,we respond better to:
A)positive framing.
B)negative framing.
C)neither;research has shown that framing ultimately doesn't matter.
D)Cannot say.It depends on the situation.

Accepted Answer

Research has consistently shown that people respond better to positive framing. This means that when presented with options or information, people are more likely to choose or be positively influenced by messages that focus on the benefits or rewards of a decision, rather than the potential losses or risks. For example, a message that says "if you quit smoking, you'll reduce your risk of cancer and improve your overall health" is more effective than a message that says "if you keep smoking, you're at risk for cancer and other health problems."

Question 16

Cyndi says to you,"I'm wondering if I should study abroad in France." You studied in Germany two years ago,and found the cost of living (not counting tuition)to be about $5,000 for a semester,so you say,"I bet it will cost you about $5,000,not counting tuition." Your answer demonstrates:
A)biased expectations.
B)anchoring.
C)using a piece of information loosely related and applying it to your guess.
D)All of these statements are true.

Accepted Answer

The answer of Cyndi says to you,"I'm wondering if I...

Question 17

A person setting up automatic deductions through their employer so a portion of their pay goes into a "Christmas account" is an example of:
A)status quo bias.
B)the endowment effect.
C)positive framing.
D)a commitment device.

Accepted Answer

This is an example of a commitment device, as the person is setting up automatic deductions to ensure that they save money for Christmas rather than relying on their own willpower to set aside money. A commitment device is a strategy used to help individuals follow through with their intentions by limiting their future choices.

Question 18

Commitment devices are:
A)mechanisms that allow people to voluntarily restrict their choices in order to make it easier to stick to plans.
B)socially institutionalized practices that signal a particular commitment has been made by a person.
C)policies that force participants to choose their future commitments.
D)None of these statements is true.

Accepted Answer

Commitment devices are mechanisms, such as self-imposed deadlines or financial penalties, that individuals put in place to help themselves stick to their goals or plans. These devices work by restricting an individual's choices or increasing the costs of deviating from their stated goals, creating a greater motivation to follow through with their commitments.

Question 19

If someone asked you to predict the price of gas in a month,and you decided to just guess by adding a few cents to the current price of gas,which you know,your answer would exhibit:
A)anchoring.
B)time inconsistency.
C)rational expectations.
D)None of these statements is true.

Accepted Answer

Anchoring refers to the tendency of individuals to rely too heavily on the first piece of information they receive when making decisions. In this case, the individual is relying on the current price of gas as the anchor for their prediction, without considering other factors that may affect the price.

Question 20

Commitment devices are:
A)methods to increase the price of your vices.
B)methods to lower the price of your virtues.
C)successful whether weak or strong,depending on the situation.
D)All of these statements are true.

Accepted Answer

Commitment devices refer to methods to increase the price of vices and lower the price of virtues. These devices can be weak or strong, depending on the situation. Therefore, all of the given statements are true.

Quiz 23: Public Policy and Choice Architecture

Commitment devices can be:

A person committing to carpool with a friend to the gym for daily workouts is an example of:

Susie doesn't buy ice cream this week at the grocery store because she intends to start a diet in a few days.Her behavior is an example of:

A store is choosing between advertising a credit card fee or a discount for paying cash to its customers.More customers are likely to pay cash if the store owner advertises:

The Save More Tomorrow (SMarT) program is an example of a:

Suppose you were asked,"Can you guess the height of the tallest living man? Is it more than 8 feet?" When people suggest an answer in the question they ask,it is a form of:

An example of a heuristic is:

John is buying a scented candle for his girlfriend.John thinks about her flower-scented perfume,flower-scented air spray,and flower-scented shampoo.He decides to buy her a flower-scented candle.His behavior is:

Commitment devices:

A person cutting up their credit cards in an effort to curb their spending is an example of:

Suggested donations on fundraising items sent to you in the mail is an example of:

A heuristic is:

Commitment devices can be:

In terms of framing,we respond better to:

Cyndi says to you,"I'm wondering if I should study abroad in France." You studied in Germany two years ago,and found the cost of living (not counting tuition) to be about $5,000 for a semester,so you say,"I bet it will cost you about $5,000,not counting tuition." Your answer demonstrates:

A person setting up automatic deductions through their employer so a portion of their pay goes into a "Christmas account" is an example of:

Commitment devices are:

If someone asked you to predict the price of gas in a month,and you decided to just guess by adding a few cents to the current price of gas,which you know,your answer would exhibit:

Commitment devices are: