What do behavioral economics and neuroeconomics seek to achieve?
What will be an ideal response?
Behavioral economics and neuroeconomics seek to explain why we do not always make rational economic decisions. Behavioral economists study how the bounded limitations they study affect people's decisions so that not all decisions are the consequence of rational behavior. Neuroeconomists study how the brain works to make decisions so that neuroeconomists have a better understanding of the decisions people make.
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Without usury laws, banks will
A) charge very high interest rates to all borrowers. B) charge higher interest rates to riskier borrowers than to safer borrowers. C) charge very low interest rates to all borrowers. D) face no demand for loans.
What are the goals of an economic system? What is the criterion to measure the effectiveness of a system?
What will be an ideal response?