The Tendency to Underestimate the Influence of External Factors and Overestimate

question 81

Multiple Choice

The tendency to underestimate the influence of external factors and overestimate the influence of internal factors when making judgments about the behaviour of others is known as

• A)distinctiveness.
• B)fundamental attribution error.
• C)selective perception.
• D)self-serving bias.
• E)halo effect.

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Definitions:

Fiscal Policy

Government policies related to taxation and spending that are used to influence the economy, including efforts to manage demand, stimulate economic growth, or control inflation.

Higher Inflation

An economic condition characterized by a significant and rapid increase in the general price level of goods and services in an economy over a period of time.

Tax Cuts

Reductions in the amount of taxes imposed by the government on individuals or businesses.

Aggregate Supply

The total supply of goods and services that firms in an economy plan on selling during a specific time period.