Averages and Indices Differ from One Another in That an Index

question 15

Multiple Choice

Averages and indices differ from one another in that an index

• A) always moves up before a corresponding average moves up, and always moves down before a corresponding average moves down.
• B) measures the current price behaviour of a group of stocks in relation to a base value set at an earlier point in time.
• C) is the arithmetic average price behaviour of a group of shares at a given point in time.
• D) is of value in- and- of itself, whereas an average must be compared to a historical figure to have any meaning.

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Definitions:

Situational Attributions

Explanations for behaviour based on an actor’s external situation or environment.

Self-serving Bias

The common human tendency to attribute successes to internal factors (like ability or effort) and failures to external factors (like luck or bias).

Dispositional

Refers to inherent personality traits and tendencies that influence behavior and attitudes.

Situational

Depending on or relating to a specific set of circumstances or context, often implying that different situations require different responses or actions.