You Ask Several of Your Friends to Rate the Likelihood

question 230

Multiple Choice

You ask several of your friends to rate the likelihood of the following statements: (1) There will be a flood in British Columbia, (2) There will be an earthquake in British Columbia that causes a flood. Almost all of your friends rate statement (2) as more likely. These likelihood estimates are _____________ and illustrate the use of _____________.

• A)correct; inductive reasoning
• B)incorrect; the representativeness heuristic
• C)correct; the availability heuristic
• D)incorrect; a confirmation bias

---

Definitions:

Accounting Equation

The foundational equation in accounting that represents the relationship between assets, liabilities, and owners' equity, expressed as Assets = Liabilities + Owners' Equity.

Electric Bill

A monthly charge for the consumption of electricity, typically issued by an electricity provider.

Accounting Equation

The foundational equation in accounting, representing the relationship between assets, liabilities, and equity (Assets = Liabilities + Equity).

Supplies

Consumable items or materials used in the daily operations of a business or for the completion of a task.