The Transaction Costs Associated with International Trading of Stocks Have

question 22

Multiple Choice

The transaction costs associated with international trading of stocks have been reduced by

• A) the consolidation of stock exchanges.
• B) extensive computerization.
• C) the Eurolist system
• D) all of the above

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Definitions:

Anchoring and Adjustment Bias

A cognitive bias where an individual relies too heavily on an initial piece of information (anchor) when making decisions, even if it is unrelated or irrelevant.

Availability Bias

A cognitive bias where people overestimate the importance of information that is readily available to them.

Confirmation Error

A cognitive bias where individuals favor information that confirms their existing beliefs or hypotheses.

Representativeness Bias

A cognitive bias where individuals incorrectly assess the likelihood of an event based on how closely it resembles their stereotypes of a category.