The Likelihood of an Investment Newsletter's Successfully Predicting the Direction

question 9

Multiple Choice

The likelihood of an investment newsletter's successfully predicting the direction of the market for three consecutive years by chance should be

• A) between 50% and 70%.
• B) between 25% and 50%.
• C) between 10% and 25%.
• D) less than 10%.
• E) greater than 70%.

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Definitions:

Predicts Future Behavior

The act of using current and past information to make informed guesses about future actions or trends.

Trait

A characteristic or quality of an organism, which can be physical or behavioral, genetically determined or acquired.

Guilt

A cognitive or emotional experience that occurs when a person believes or realizes—accurately or not—that they have compromised their own standards of conduct or have violated a moral standard and bear significant responsibility for that violation.

Egocentricity

The inability to differentiate between one's own perspective and someone else's perspective, commonly seen in early childhood development.