Analyze how judgment regarding risky events is subject to errors because people tend to overestimate the probability of infrequent events, often because they’ve heard of or seen a recent example.
Discuss how an extended warranty on a consumer product is like insurance. Evaluate the cost-effectiveness of extended warranties on three consumer products: a new automobile, a smart phone, and a dishwasher, considering the likelihood that the product will fail, the cost of replacing the item, and the price of the warranty.
Subject Area: Social Studies
Strand: Financial Literacy
Date Adopted or Revised: 04/15
Status: State Board Approved