The Sunk-Cost Fallacy States That People Tend to Make Poorer

question 88

True/False

The sunk-cost fallacy states that people tend to make poorer financial decisions when information is presented in probability form relative to frequency form.

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Definitions:

T-Distribution

A probability distribution that is symmetric and bell-shaped, used in hypothesis testing and setting confidence intervals when the sample size is small.

Population Normal

Population normal, often referring to a normal distribution in a population, describes a bell-shaped frequency distribution that is symmetric about the mean.

Hourly Fees

A method of billing where charges are applied based on the amount of time spent on a task, usually measured in hours.

Significance Level

The probability of rejecting the null hypothesis in a statistical test when it is actually true; a measure of the risk of making a Type I error.