Behavioral Economics Unit

Students will be able to

• Practice making financial decisions 
• Reflect on their personal values and how they can influence their financial decisions 
• Explore how values differ from person to person

Students will be able to:

• Experience cognitive biases through thought experiments
• Identify various cognitive biases
• Give examples of cognitive biases in their own lives
• Explain what cognitive bias is and how it can impact their decision making

Students will be able to:

• Discuss the cognitive bias of loss aversion and how it can influence our decisions
• Make decisions that involve risk and the possibility of loss
• Analyze how loss aversion can impact us as consumers 
• Learn how to overcome loss aversion

Students will be able to:

• Identify how the endowment effect and sunk costs can affect our decision making
• Discuss how the endowment effect and sunk costs are connected to our personal finances
• Practice making decisions that are influenced by sunk costs

Students will be able to

• Understand what herd mentality and FOMO are
• Explain how these two cognitive biases impact our personal finances 
• Identify practical steps someone can take to combat the influence of herd mentality and FOMO

Students will be able to

• Understand what confirmation bias and overconfidence are 
• Explain how these two biases can influence their decision making 
• Explore strategies to avoid confirmation bias and overconfidence

Students will be able to

• Understand what hedonic adaptation is and how it influences our financial decisions
• Explain why we are driven to buy more stuff 
• Identify steps someone can take to counteract the impact of hedonic adaptation

In this lesson, students will be able to:

• Experience cognitive biases through thought experiments
• Identify various cognitive biases
• Give examples of cognitive biases in your own life
• Explain what cognitive bias is and how it can impact our decision making

In this lesson, students will be able to:

• Discuss the cognitive bias of loss aversion and how we feel the effect of losses more than gains
• Make decisions that involve risk and the possibility of loss
• Analyze loss aversion from the perspective of consumers and investors
• Choose strategies that will help overcome loss aversion

In this lesson, students will be able to:

• Identify how the endowment effect and sunk costs affect our decision making
• Discuss how the endowment effect and sunk costs are connected to our personal finances
• Demonstrate making decisions after you’ve already spent time, money, or effort
• Choose strategies that are helpful in combating the endowment effect and sunk costs

In this lesson, students will be able to:

• Understand what herd mentality and FOMO are
• Explain how these two cognitive biases impact our personal finances 
• Identify practical steps someone can take to combat the influence of herd mentality and FOMO

In this lesson, students will be able to:

• Understand what confirmation bias is and how it can influence your decision making
• Identify types of overconfidence and give examples that show up in everyday life
• Explore strategies to avoid confirmation bias and overconfidence

In this lesson, students will be able to:

• Understand what hedonic adaptation is and how it influences our financial decisions
• Explain the connection between our happiness levels and how much we earn and spend 
• Identify steps someone can take to counteract the impact of hedonic adaptation

Students will be able to:

• Reflect on the various cognitive biases you have learned about in this unit
• Identify the variety of ways social media marketers use cognitive biases to influence consumer behavior 
• Work with your peers to create a social media marketing strategy for a specific product