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Imagine That Your Friend Comes Down with a Cold and After

question 39

Essay

Imagine that your friend comes down with a cold and after being sick for a few days takes a supplement called "essence of wormroot" and gets better soon afterward. She then credits the supplement for her recovery. Based on what you know about the likely mechanism of how placebos work, what is the likely explanation for her recovery?


Definitions:

Common Share

A type of equity security that represents ownership in a corporation and entitles the holder to voting rights and dividends.

Derivative Security

A financial instrument whose value is based on the performance of an underlying asset, index, or security.

Related Security

Related Security implies a financial instrument that is linked to another in terms of performance, underlying assets, or issuer.

Value

The monetary, material, or assessed worth of an asset, good, or service.

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