Which of the Following Is True About the Overconfidence Bias

question 29

Multiple Choice

Which of the following is true about the overconfidence bias?

• A) It occurs when individuals react to arbitrary or irrelevant numbers when setting financial or other numerical targets.
• B) It occurs when information that is readily available is incorrectly assessed to also be more likely.
• C) It occurs when good outcomes are attributed to personal characteristics, but undesirable outcomes are attributed to external circumstances.
• D) It occurs when mistakes seem obvious after they have already occurred.
• E) It occurs when individuals have more faith in their abilities to predict an event than logic suggests is actually possible.

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Definitions:

Payee

A payee is a person or organization to whom money is paid or is to be paid.

Check

A written order instructing a bank to pay a specified amount of money from the writer's account to the person or entity in whose name the check has been issued.

Certificate Of Deposit

A savings certificate with a fixed maturity date and specified fixed interest rate that is issued by a bank.

Note

A promise by the maker of the note to pay the payee of the note.