Behavioral Finance

In: Business and Management

Submitted By Noora64
Words 1352
Pages 6
Question 1:
(A) EEG, PET, and FMRI are tools that help in measuring brain activity. It is important to ask how good these tools are when measuring brain activity based on timing and location.
Temporal resolution is a measure of the timing or how quickly and accurately can these tools pick on brain activity. Temporal resolution includes the smallest neural activity in the brain that can be detected.
Spatial resolution is a measure of where the neural activity, with precision, is located. So how good is the graphic display or how well is the image.
(B) EGG is a really good measure of timing; it can pick up when the electrical impulses happen relatively quickly. It is related as the best temporal resolution measure from all the tools; however, it is a poor measure of mentioning where the impulses happen. It is ranked as the worst from all the three in terms of spatial resolution.
FMRI is the best measure in term of spatial resolution. It can detect a spatial range from mm to cm. In terms of temporal it is the second best, it can detect neural activity within almost two seconds and with technological improvements it is getting faster and faster.
(C) FRMI would be better to measure the brain activation in the limbic system. FMRI essentially uses the same technology as the MRI but it more function. Brain activity can be measure through the blood flow. FMRI tells us essentially tells us what is happening in out brain while we are making our decisions. It will have a good read on where and when those signals are happening. However, despite that FMRI requires repeated sampling to account for noise such as heart beats, breathing and other factors it is very accurate in predicting ones emotions.
Question 2.
Many researchers have done research to show that being in a good mood causes individuals to purchase more stocks and take on more risk; researchers have shown…...

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