BU.555.710
Applied & Behavioral Economics
Finals Exam Review (Qns & Ans)
2025
1. Multiple Choice
Question: In behavioral economics, which concept explains
why patients prefer avoiding losses rather than acquiring gains?
A. Anchoring effect
B. Loss aversion
C. Present bias
D. Mental accounting
ANS: B
©2025
, Rationale: Loss aversion describes the tendency for individuals
to strongly prefer avoiding losses over acquiring equivalent gains,
influencing decision-making behaviors in healthcare.
---
2. Fill-in-the-Blank
Question: The ____________ heuristic refers to the tendency
of individuals to rely on the first piece of information encountered
when making decisions.
ANS: anchoring
Rationale: Anchoring occurs when an initial value
disproportionately influences subsequent judgments, even if
irrelevant to the decision.
---
3. True/False
Question: Behavioral nudges are designed to influence
decision-making without restricting choices or significantly
changing financial incentives.
©2025
, ANS: True
Rationale: Nudges use subtle cues to influence behavior while
preserving freedom of choice, such as default options in
healthcare plans.
---
4. Multiple Response
Question: Which factors influence health-related decision-
making according to behavioral economics? (Select all that apply)
- A. Time preferences
- B. Information framing
- C. Availability bias
- D. Randomized clinical trials
ANS: A, B, C
Rationale: Time preferences, framing effects, and cognitive
biases like availability bias significantly influence health
decisions. Randomized trials are research methods, not behavioral
factors.
---
©2025
, 5. Multiple Choice
Question: Which intervention best demonstrates the use of a
"default option" in behavioral economics?
A. Offering patients financial incentives to attend annual
checkups
B. Automatically enrolling employees in employer-provided
health insurance plans
C. Educating patients about the importance of preventive care
D. Increasing penalties for late insurance payments
ANS: B
Rationale: Default options leverage inertia by automatically
enrolling individuals in beneficial programs, such as health
insurance, while allowing opt-out options.
---
6. Fill-in-the-Blank
Question: ____________ bias in healthcare arises when
individuals give greater weight to recent or easily recalled events
when making decisions.
©2025
Applied & Behavioral Economics
Finals Exam Review (Qns & Ans)
2025
1. Multiple Choice
Question: In behavioral economics, which concept explains
why patients prefer avoiding losses rather than acquiring gains?
A. Anchoring effect
B. Loss aversion
C. Present bias
D. Mental accounting
ANS: B
©2025
, Rationale: Loss aversion describes the tendency for individuals
to strongly prefer avoiding losses over acquiring equivalent gains,
influencing decision-making behaviors in healthcare.
---
2. Fill-in-the-Blank
Question: The ____________ heuristic refers to the tendency
of individuals to rely on the first piece of information encountered
when making decisions.
ANS: anchoring
Rationale: Anchoring occurs when an initial value
disproportionately influences subsequent judgments, even if
irrelevant to the decision.
---
3. True/False
Question: Behavioral nudges are designed to influence
decision-making without restricting choices or significantly
changing financial incentives.
©2025
, ANS: True
Rationale: Nudges use subtle cues to influence behavior while
preserving freedom of choice, such as default options in
healthcare plans.
---
4. Multiple Response
Question: Which factors influence health-related decision-
making according to behavioral economics? (Select all that apply)
- A. Time preferences
- B. Information framing
- C. Availability bias
- D. Randomized clinical trials
ANS: A, B, C
Rationale: Time preferences, framing effects, and cognitive
biases like availability bias significantly influence health
decisions. Randomized trials are research methods, not behavioral
factors.
---
©2025
, 5. Multiple Choice
Question: Which intervention best demonstrates the use of a
"default option" in behavioral economics?
A. Offering patients financial incentives to attend annual
checkups
B. Automatically enrolling employees in employer-provided
health insurance plans
C. Educating patients about the importance of preventive care
D. Increasing penalties for late insurance payments
ANS: B
Rationale: Default options leverage inertia by automatically
enrolling individuals in beneficial programs, such as health
insurance, while allowing opt-out options.
---
6. Fill-in-the-Blank
Question: ____________ bias in healthcare arises when
individuals give greater weight to recent or easily recalled events
when making decisions.
©2025
