Assume That an Analyst at a Leading Business Daily Observes

question 18

Multiple Choice

Assume that an analyst at a leading business daily observes an increase in productivity across industries which announced healthy annual bonus for their employees.This leads him to conclude that productivity is directly related to the incentive scheme followed by companies.The analyst however ignored the increase in capital per worker ratio and other technological developments in these companies which also affected productivity.This error in reasoning is related to:

• A)bounded rationality.
• B)selection bias.
• C)representative heuristics.
• D)availability heuristics.

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Definitions:

Psychographics

The study and classification of people according to their attitudes, aspirations, and other psychological criteria.

Demographics

Statistical data relating to the population and the particular groups within it.

Consumer Behaviour

The study of how individuals, groups, or organizations select, buy, use, and dispose of goods, services, ideas, or experiences to satisfy their needs and desires.

Socialization Agents

People, organizations, and institutions that play a role in how individuals learn social norms, values, and behaviors, influencing their consumption patterns and preferences.