The Common Logical Mistake of Interpreting Association as Causation

question 66

Multiple Choice

The common logical mistake of interpreting association as causation:

• A)never occurs in the real world.
• B)is another term for the fallacy of composition.
• C)occurs when unrelated or coincidental events that occur at about the same time are said to have a cause-and-effect relationship.
• D)is the error of attributing what applies in the case of one to the case of many.
• E)occurs when one variable is closely associated with another variable.

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Definitions:

FASB ASC

The Financial Accounting Standards Board Accounting Standards Codification, which is the source of authoritative GAAP recognized by the FASB to be applied by nongovernmental entities.

Quantitative Assessment

The evaluation or measurement of something based on quantity or amounts.

Qualitative Assessment

An analysis method that focuses on non-quantifiable factors such as company quality, business model, governance, and risk factors.

Equity Method

An accounting technique used by a company to record its investment in another company when it holds significant influence but not full control.