Judge Kellogg Has Just Read a Case File in Which

question 50

Multiple Choice

Judge Kellogg has just read a case file in which a defendant who had committed statutory rape was sentenced to 25 years in prison. He is considering sentencing in a statutory rape case in which the prosecutor is asking for 10 years for the defendant. Instead of going with the 10 years recommended by the prosecutor, he chooses to impose a sentence of 22 years. Judge Kellogg's decision illustrates the ____ effect.

• A) anchoring
• B) severity
• C) adversarial
• D) inquisitorial

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Definitions:

Certainty Equivalent Rate

The certain return providing the same utility as a risky portfolio.

Risk-Free Investment

An investment that is expected to return its original investment value without any loss.

Mean-Variance Criterion

The mean-variance criterion is a method for selecting investments that balance expected return against portfolio variance or risk.

Expected Return

The forecasted profit or loss from an investment over a specific period, often based on historical data or statistical models.