The Fundamental Attribution Error Refers to How People Tend to Overestimate

question 63

Multiple Choice

The fundamental attribution error refers to how people tend to overestimate the importance of personal factors and _______________ the importance of situational factors, when explaining other people's behaviours.

• A)overestimate
• B)underestimate
• C)overcompensate
• D)ignore

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Definitions:

Equity Method

A method where an investor recognizes its share of the profits and losses of the investee company it has invested in, proportionate to its ownership percentage.

Cost Method

An accounting method used to value certain investments or transactions at their original purchase cost, without reflecting subsequent changes in market value.

Consolidated Statements

Financial reports that combine the accounting information of a parent company with its subsidiaries.

Stock Investments

Financial assets representing ownership stakes in companies, which are bought and sold on stock exchanges, and can offer dividends and capital gains to investors.