Match each term with its definition.

A. Financial planning.

Personal satisfaction gained from consumption.

B. Rational choice.

Reluctance for taking chances.

C. Risk aversion.

A decision-making method that compares costs and benefits.

D. Utility.

A strategy to save for financial goals.

The right answer for the question that is being asked and shown above is that:

A. Financial planning. = > A decision-making method that compares costs and benefits.

B. Rational choice. = > A strategy to save for financial goals.

C. Risk aversion. = > Reluctance for taking chances.

D. Utility. = > Personal satisfaction gained from consumption.

Here is the pair:

- Financial planning - A strategy to save for financial goals.

financial planning is done to ensure that individuals or companies would achieve healthy financial growth.

- Rational choice - A decision-making method that compares costs and benefits.

A choice is considered as rational if the benefit outweigh the cost

- Utility - Personal satisfaction gained from consumption.

For example, when you drink a soda after working out, the loss of thirst is considered to be a utiliy

- Risk aversion - Reluctance for taking chances.

Risk aversion is most commonly used by investors to avoid experiencing unnecessary loss