Economic analysis that focuses on bounded rationality and psychological insights is known as:
A) behavioral economics.
B) Keynesian economics.
C) Austrian economics.
D) supply-side economics.

Question

Quizplus · Accepted Answer

Behavioral economics is a branch of economics that focuses on how psychological and social factors impact individual decision-making, rather than assuming perfect rationality. This approach recognizes that humans have cognitive limitations and emotional biases that can affect the choices they make, and aims to incorporate these insights into economic models. The other options listed do not specifically focus on bounded rationality or psychological factors in their economic analysis.

Economic Analysis That Focuses on Bounded Rationality and Psychological Insights