Quiz Ch 22 – Understanding Behavioral Biases
Fundamentals of Corporate Finance
Ross, Westerfield, and Jordan
13th Edition
What is the term used to describe the tendency to avoid uncertainty or ambiguity?
What is the term used to describe the tendency to avoid uncertainty or ambiguity?
Given Fahad’s decision to publish a newsletter based on his successful track record in generating high returns for his clients, what behavioral bias is likely to be at play in Fahad’s decision-making process?
What is the term used to describe the tendency to be overly conservative when presented with new information?
What is the most probable reason for a mining industry firm, with significant assets including cash, equipment, and a closed facility, to be valued at a premium beyond the market value of its assets?
In essence, what does an abandonment option do?
Which accurately describes the option to introduce flexibility into production facilities?
What describes the phenomenon where an individual’s responses may vary depending on how a question is worded, even if the meaning is equivalent?