CAS EC 101 Lecture 17: Lecture 17- 23

• School: Boston University
• Department: Economics
• Course: CAS EC 101
• Professor: Neal Becker

Document Summary

People tend to value things they already own more than things that they do not yet own. Individual choices depend on the perception of something as a gain or a loss because we dislike losses more than we like the equivalent gains. Sometimes we can frame a decision to our advantage by suggesting a number that people will use to frame the decision. Hyperbolic discounting leads to individuals making decisions that their future selves would regret. Nudge theory is the idea that you can cause people to change behavior by positive reinforcement and indirect suggestions. Brought to prominence with the book nudge: improving decisions about. Health, wealth, and happiness by richard thaler and cass sunstein. Technology is the process of using inputs to make output, while technological change is when a firm is able to produce more output with the same inputs. Any cost that remains unchanged as output changes represents a firm"s fixed cost.