When People Are Asked Which Is More Common, Death by Homicide

question 94

Multiple Choice

When people are asked which is more common, death by homicide or death by stroke, they often choose homicide because they simply hear more about murders than they do about strokes. In this instance, people are led astray in their judgments by:

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

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Definitions:

Acquisition Differential

The difference between the cost of acquiring a company and the fair value of its identifiable net assets at the time of acquisition, essentially another term for goodwill.

Trademarks

Symbols, names, phrases, or logos legally registered or established by use as representing a company or product.

Unrealized Inventory Profits

Profits that have been recorded on paper due to an increase in inventory value but have not been realized through sales.

Significant Influence

The power to participate in the financial and operating policy decisions of an investee, without having control over those policies.