Mike Is a Stock Broker and fiNancial Planner

question 74

Multiple Choice

Mike is a stock broker and financial planner. Phil is one of Mike's clients. Phil prefers to meet with Mike just once a year to review his investment portfolio. At their most recent meeting, Phil stated he
Believes the stock market is going to decline in value over the next six months. Thus, Phil instructed
Mike to sell every stock he owns that is currently worth more than what he paid to purchase it. Phil
Also instructed Mike to retain any stock that would create a capital loss if sold. Phil is displaying the
Behavior known as:

• A) Over-confidence.
• B) Arbitrage theory.
• C) The disposition effect.
• D) The house money effect.
• E) A confirmation bias.

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Definitions:

Programs in Entrepreneurship

Educational or training initiatives designed to teach individuals the skills and knowledge necessary to start, manage, and grow businesses.

U.S. Universities

Institutions of higher education in the United States offering undergraduate, postgraduate, and doctoral programs in various disciplines.

Aging Population

A demographic trend characterized by an increase in the proportion of older individuals in the population.

Entrepreneurs

Entrepreneurs are individuals who start and manage their own businesses, often taking on financial risks in the hope of profit.