When an Assumption or Belief Keeps Us from Considering the Evidence

question 108

Essay

When an assumption or belief keeps us from considering the evidence fairly,or causes us to ignore the evidence completely,it becomes a bias.Often a bias remains hidden until someone changes our belief and we get defensive.Describe how the 1998 book by Judith Rich Harris (The Nurture Assumption)questioned prevailing assumptions.

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Definitions:

Fair Value Adjustments

Adjustments to the reported value of an asset or liability to reflect its current market value.

Fair Value

The amount one would expect to receive from the sale of an asset or the cost to transfer a liability during a structured transaction among parties in the market as of the valuation date.

Financial Instruments

Contracts that give rise to both a financial asset of one entity and a financial liability or equity instrument of another entity, such as stocks, bonds, or derivatives.

Business Combination

A transaction or event in which an acquirer gains control over one or more businesses, typically through the acquisition of equity interests.