An Unwillingness to Take a Risk After a Loss Describes

question 29

Multiple Choice

An unwillingness to take a risk after a loss describes:

• A)over-confidence.
• B)the snakebite effect.
• C)the illusion of knowledge.
• D)the clustering illusion.
• E)loss aversion.

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Definitions:

Growth Rate

The rate at which a company's earnings or the economy's output increases over time.

Expected Return

The anticipated amount of profit or loss an investment is likely to generate over a specific period.

Required Return

The minimum expected return an investor demands for the level of risk taken on an investment.

Dividend

A part of a company's profits given out to its shareholders, often as cash or extra stock.