You Caution a Friend About Eating So Many Foods That

question 421

Multiple Choice

You caution a friend about eating so many foods that are high in fat content. Your friend replies that his grandfather ate all the bacon and cheese he wanted, and he lived to be 93. Which of the following is the BEST explanation for your friend's error in reasoning?

• A)the anthopocentric effect
• B)the use of individual cases
• C)a self-fulfilling prophecy
• D)the fallacy of negative instances

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Definitions:

Recognized Gain

The profit realized from the sale or exchange of an asset over its adjusted basis.

Adjusted Basis

The net cost of an asset after adjusting for various tax-related items, such as improvements and sales.

Fair Market Value

The estimated price an asset would fetch in the marketplace, subject to the willingness of both buyer and seller.

Recognized Loss

A loss on an investment that has been sold for less than its purchase price, which can be used to offset capital gains for tax purposes.