Following the September 11, 2001, Twin Towers Attacks, Many Americans

question 59

Multiple Choice

Following the September 11, 2001, Twin Towers attacks, many Americans elected to drive rather than fly: The media coverage of the hijackings caused Americans to overestimate the danger of flying. This example illustrates:

• A)the availability heuristic
• B)the representativeness heuristic
• C)the confirmation bias
• D)overconfidence

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Definitions:

Investment

The dedication of assets to achieve an increase in value over time, including purchases of securities, real estate, and other items with the expectation of generating future income or profit.

Target Costing

A pricing strategy where a product's selling price is determined first based on market conditions, and then the goal is to meet or come under this price through cost control and design efficiencies.

Minimum Return

The lowest acceptable rate of return on an investment that a person or company would consider worthwhile.

Investment

The allocation of resources, usually money, in expectation of generating an income or profit.