Some Argue That Abnormally High Returns of Hedge Funds Are

question 17

Multiple Choice

Some argue that abnormally high returns of hedge funds are tainted by ________, which arises when unsuccessful funds cease operations, leaving only successful ones.

• A) reporting bias
• B) survivorship bias
• C) backfill bias
• D) incentive bias

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Definitions:

Promissory Estoppel

A legal principle that prevents a party from going back on a promised commitment, even if a legal contract does not exist, due to the reliance of the other party on that promise.

Creditor's Promise

A declaration made by a creditor, indicating their intention to extend credit to a debtor under agreed terms.

Tender

The formal process of submitting a proposal or bid to undertake a contract or supply goods or services.

Consideration

Something of value that is exchanged between parties as part of a contract, making the agreement legally binding.