have to give up work hours and income by going to college.

Access for free at openstax.org
6.3 • Behavioral Economics: An Alternative Framework for Consumer Choice 153

FIGURE 6.6 The Impact of Education on Earnings and Unemployment Rates, 2012 Those with the highest degrees

in 2012 had substantially lower unemployment rates; whereas, those with the least formal education suffered from

the highest unemployment rates. The national median average weekly income was $815, and the nation

unemployment average in 2012 was 6.8%. (Source: U.S. Bureau of Labor Statistics, May 22, 2013)
154 6 • Key Terms

Key Terms

behavioral economics a branch of economics that seeks to enrich the understanding of decision-making by

integrating the insights of psychology and by investigating how given dollar amounts can mean different

things to individuals depending on the situation

budget constraint (or budget line) shows the possible combinations of two goods that are affordable given a
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