Reading 54: Efficient Capital Markets - LOS d ～ Q1-3 class, behavioral, finance, respect, black

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1.With respect to behavioral finance, the tendency to place too much faith in an earnings forecast is known as:

A)   confirmation bias.

B)   overconfidence bias.

C)   escalation bias.

D)   anchoring.

2.In behavioral finance, the tendency to seek out good news and ignore bad news is called:

A)   overconfidence bias.

B)   confirmation bias.

C)   escalation bias.

D)   anchoring.

3.The tendency to commit additional funds to a position that has decreased in value is known in behavioral finance as:

A)   overconfidence bias.

B)   confirmation bias.

C)   escalation bias.

D)   anchoring.

 

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答案和详解如下：

1.With respect to behavioral finance, the tendency to place too much faith in an earnings forecast is known as:

A)   confirmation bias.

B)   overconfidence bias.

C)   escalation bias.

D)   anchoring.

The correct answer was B)

The tendency to place too much faith in an earnings forecast falls under the heading of overconfidence bias in the context of behavioral finance.

2.In behavioral finance, the tendency to seek out good news and ignore bad news is called:

A)   overconfidence bias.

B)   confirmation bias.

C)   escalation bias.

D)   anchoring.

The correct answer was

The tendency to seek out good news and ignore bad news falls under the heading of confirmation bias in the context of behavioral finance.

3.The tendency to commit additional funds to a position that has decreased in value is known in behavioral finance as:

A)   overconfidence bias.

B)   confirmation bias.

C)   escalation bias.

D)   anchoring.

The correct answer was C)

The tendency to commit additional funds to a position that is decreasing in value falls under the heading of escalation bias in the context of behavioral finance.