Description
when economists make their models, they assume that people are rational. However, actual human behavior is often impulsive and irrational. this video describes the notion of irrational human behavior by illustrating the fundamentals of behavioral economics. the assignment requires a 1 - 2 page summary of the key concepts covered in the video. while working on this assignment, please use examples where ever possible. you may use your own examples or the ones provided in the video. video link: https://www.youtube.com/watch?v=dqxQ3E1bubI
Explanation & Answer
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Running head: BEHAVIORAL ECENOMICS
Behavioral Economics
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Institution
Date
1
BEHAVIORAL ECENOMICS
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The economists in classical theory assume that people think rationally and in a
predictable manner while deciding things to buy. However, in the real situations, customers think
irrationally. This makes them irregular and unpredictable. In behavioral economics, a new
perspective of the manner in which people make decisions is described. It presents
psychological, social, and emotional factors that influence decision-making. In a typical
situation, people w...
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