Fundamental Attribution Error Refers to the Tendency to Attribute the Behavior

question 116

True/False

Fundamental attribution error refers to the tendency to attribute the behavior of other people to internal factors more than external factors.

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Definitions:

Capital Gains

The increase in value of an asset or investment above its purchase price, realized upon the sale of the asset.

Clientele Effect

A theory suggesting that the types of investors attracted to certain stocks or dividends policies can affect the stock price or policy sustainability.

Dividend Policy

Guidelines a company follows to decide how much it will pay out to shareholders in dividends.

Investors

Individuals or institutions that allocate capital to various types of investments with the expectation of earning a financial return.