Tag: Discussion starter

Micro

Elasticity of Water

Jadrian Wooten

The Kahoot provides an interesting example of the price elasticity of demand for water. Students are given enough information to calculate the price elasticity using the midpoint method.  Since the coefficient is negative and between 0 and -1, the price elasticity of demand in inelastic – that is the correct answer. However, many students object, stating that they would never pay $5 for bottled water (their demand in elastic), to which you should respond, “It’s the Hilton, as long as bottled water drinkers value the convenience more that then extra price they pay, their demand is inelastic. Don’t confuse what you would do with what others decide to do.”

Course Used: Principles of Micro
Quiz Nature: Discussion starter
Question Length: 1
Estimated Time to Play: 3-5 minutes with explanation.

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Behavioral

Allais Paradox

Jadrian Wooten

The Kahoot replicates the Allais Paradox. Maurice Allais received the Nobel Prize in Economics for demonstrating that income was a key determinant of risk preference. Before Allais economists assumed that people were either risk averse, risk neutral of risk takers and that their preferences did not change. It is our experience that 20-30 percent of your students will choose gambles 1 and B (just like Allais’ subject did over 30 years ago).

Course Used: Principles of Micro
Quiz Nature: Discussion Starter
Question Length: 1
Estimated Time to Play: 5 minutes.

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Behavioral

Monty Hall Problem

Jadrian Wooten

Misperceptions of probabilities is one the human limitations that behavioral economists examine. One of the most famous examples is the Monty Hall problem, named after Monty Hall the original host of Let’s Make a Deal.  On the show Monty Hall would show the final contestant three doors and ask them to choose one. Then he would reveal a “goat” behind one of the doors the contestant did not choose. At that point, he’d then ask the contestant if they would like to switch doors. The contestant should since this gives them a 2/3rd chance of winning the grand prize but most don’t switch because they don’t want to regret the switch if it turns out that their first choice of doors is the winner. Regret is an important behavioral concept that causes people to make choices that fail to maximize the expected value of probability distributions. There is also a wonderful scene in 21 that explains the problem superbly:

Course Used: Principles of Micro
Quiz Nature: Discussion Starter
Question Length: 2
Estimated Time to Play: 5-8 with explanation of the mathematics.

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Macro, Micro

Shifts vs Movement of Demand

Jadrian Wooten

Understanding the difference between a change in demand and a change in the quantity demanded is crucial to success in any principles course. This question will stump many of your students but not all. Pro tip: once the correct answer is revealed, ask one of your students to explain the answer!

Course Used: Principles of Micro
Quiz Nature: Discussion Starter
Question Length: 1
Estimated Time to Play: 15-20 minutes.

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Micro

Elastic Demand

Jadrian Wooten

The question is designed to test your students intuition for which goods have elastic or inelastic demand. By utilizing the three primary determinants of demand (number of substitutes, the share of the budget spent on the good, and the time frame for making a decision) you can explain why three answers are wrong and one is correct.

Course Used: Principles of Micro
Quiz Nature: Discussion starter
Question Length: 1
Estimated Time to Play: Anywhere from 2 to 5 minutes depending on how much follow-up is needed.

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Behavioral

Gift Giving

Jadrian Wooten

This poll question is a great way to begin a discussion on the deadweight loss of gift giving (Waldfogel, 1993). After surveying your class with this Kahoot play a short video from Adam Ruins Everything:

Ask your students if they think gift giving really creates deadweight loss or did Waldfogel’s analysis miss any crucial valuations.

Course Used: Principles of Micro
Quiz Nature: Discussion starter
Question Length: 1
Estimated Time to Play: Anywhere from 2 to 10 minutes depending on how much follow-up is needed.

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Micro

Elasticity and Taxes

Jadrian Wooten

This assessment question has two layers. First to answer the question correctly, the student must understand elasticity. Second, the student must understand that the tax burden is a function of the interplay between the price elasticity of demand and the price elasticity of supply. Unless your students are well-prepared and already understand this concept well, it is a good idea to illustrate the correct answer graphically to reinforce understanding.

Course Used: Principles of Micro
Quiz Nature: Discussion Starter
Question Length: 1
Estimated Time to Play: Anywhere from 2 to 10 minutes depending on how much follow-up is needed.

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Behavioral

Framing

Jadrian Wooten

This question recreates one of the classic behavioral findings about framing. When confronted with a choice that has the same expected probability, people are often swayed by the way the choices are presented. Would you rather have a 10% chance of mortality or would you rather have a 90% chance of survival are the same but, not surprisingly people predictably choose a 90% chance of survival.

Course Used: Principles of Micro
Quiz Nature: Discussion Starter
Question Length: 1
Estimated Time to Play: Less than 2 minutes.

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