Question 1
Behavioral economics
◦ blends insights from sociology and economics.
◦ suggests that too much variety may be welfare enhancing.
◦ has contributed to microeconomics but not to macroeconomics.
◦ suggests that consumers purchase health club memberships instead of paying per visit in an attempt to commit themselves to an exercise regime.
Question 2
The Internet has had a significant influence on advertising in all of the following ways
except
◦ the Internet allows firms to actively interact with customers.
◦ the Internet has improved firms' ability to target specific markets.
◦ the Internet has reduced the level and transparency of informational advertising.
◦ the Internet has reduced spending on advertising.