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Behavioral Finance - Reading 7: Heuristic-Driven Bias: The

Q6. Which of the following most likely explains Tom Heggins’s behavior in investment decisions?

A)   Tom uses a top-down approach to assess his skills.

B)   Tom uses anchoring to assess his skills.

C)   Tom uses the ceteris-paribus heuristic to assess his skills.

Q7. Which of the following best describes Joanne McHale’s behavioral characteristic in investment decisions?

A)   Joanne is loss averse.

B)   Joanne uses the ceteris-paribus heuristic.

C)   Joanne’s regret too heavily influences her investment decisions.

Q8. Which of the following best describes Jack Sims’s behavioral characteristic in investment decisions?

A)   Jack is overconfident.

B)   Jack uses representativeness.

C)   Jack uses frame dependence.

Q9. Which of the following would Heggins, McHale, and Sims be least likely to use when making investment decisions?

A)   Heuristics.

B)   Their personal experiences.

C)   Fundamental analysis.

 

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