According to the Theory of Recency Bias, Investors Tend to Believe

question 56

Multiple Choice

According to the theory of recency bias, investors tend to believe the financial markets will:

• A)gravitate to their long-term average rates of return.
• B)react over the next year in direct opposition to the performance of the prior year.
• C)have a maximum of three years of positive annual returns before declining somewhat.
• D)continue to perform as they have over the past couple of years.
• E)tend to reverse direction at least every five years.

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Definitions:

Intellectual Capital

The intangible assets of an organization, encompassing knowledge, skills, innovation, and relationships that contribute to its competitive advantage.

Competitive Advantage

The attributes that allow an organization to outperform its competitors, often leading to greater sales or margins.

Organisational Training

Programmes and activities designed to improve the skills, knowledge, and competencies of employees within an organization.

Groupware

Groupware refers to software designed to help groups collaborate more effectively, providing tools for communication, project management, and file sharing among team members, regardless of their location.