When Soyeon, Who Lives in Korea, Buys Stock in General

question 84

Multiple Choice

When Soyeon, who lives in Korea, buys stock in General Electric, an American company, U.S. net capital outflow:

• A) decreases.
• B) is unaffected.
• C) increases.
• D) becomes zero.

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Definitions:

Functional Fixedness

A bias in cognition that confines a person to employ an object exclusively in its customary use, obstructing the process of generating creative solutions.

Mental Sets

Mental sets refer to the tendency to approach situations in a certain way because that method worked in the past, potentially preventing us from seeing alternative solutions.

Effective Problem Solving

A process of defining a problem, generating solutions, and choosing the best course of action to address the issue at hand.

Law Of Small Numbers

A bias in which people infer patterns or make generalizations from a small sample size, which may lead to misleading conclusions.