Explain the Fundamental Attribution Error

question 8

Essay

Explain the fundamental attribution error.Provide three explanations for why it occurs.

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Definitions:

Consolidated Retained Earnings

The accumulated net income of a corporation and its subsidiaries after dividends have been paid out to shareholders.

Gain or Loss

The financial result that occurs when the selling price of an asset differs from its purchase price, either as a profit or a deficit.

Share Issue

A process by which a company distributes new shares to shareholders, either as part of a public offering or a private placement.

Acquisition Differential

The difference between the cost of an acquisition and the fair value of the net identifiable assets acquired.