The Planning Fallacy Is the Tendency to

question 119

Multiple Choice

The planning fallacy is the tendency to

• A)overestimate how long a task will take.
• B)not make plans.
• C)predict accurately how long a task will take.
• D)underestimate how long a task will take.

Explore the impact of technological improvements on comparative advantage and production possibilities.

Understand the concept of human capital and its importance to the economy.

Grasp the principles of comparative advantage and international trade.

Interpret production possibilities and circular-flow diagrams to analyze economic adjustments.

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Definitions:

Periodic Inventory System

A method of inventory valuation where inventory counts and cost of goods sold calculations are made periodically at the end of a reporting period, instead of after each sale.

Cost Flow Assumptions

Accounting principles that dictate how the cost of goods sold and ending inventory values are calculated, such as FIFO (First-In, First-Out) or LIFO (Last-In, First-Out).

LIFO

"Last In, First Out" - an inventory valuation method where the most recently produced or purchased items are recorded as sold first.

FIFO

"First-In, First-Out," an inventory valuation method where goods first purchased or produced are the first to be sold or used.