David Is a Small Business Owner Who Thinks It Is

question 124

Multiple Choice

David is a small business owner who thinks it is more important to spend money on marketing his current product line than to invest in research to develop new products. Which psychological bias is David displaying?

• A)Framing effects
• B)Discounting the future
• C)Illusion of control
• D)Affective conflict
• E)Cognitive conflict

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Definitions:

Capital

Economic resources used in the production of goods and services, such as machinery, buildings, or tools.

Construction Crane

A type of machinery used on construction sites to lift and lower materials and to move them horizontally.

Savings Account

A deposit account held at a financial institution that provides principal security and a modest interest rate.

Entrepreneur

An individual who creates new business ventures, taking on financial risks in the hope of profit.