How Might Self-Serving Bias Be Observed in a Corporate Annual

question 28

Multiple Choice

How might self-serving bias be observed in a corporate annual report?

• A) The report would say more about the company's problems and less about its successes
• B) The report would emphasise the role of competition,inflationary pressures and other external causes of problems in the organisation's performance
• C) The report would exclude any bad news about the organisation's performance
• D) The report would acknowledge that competition,the economy and other external factors should be credited for some of the company's recent success
• ACCSB: Reflective thinking

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Definitions:

Inferior Goods

A good that has a negative income elasticity, so that as consumer income rises, the demand for the good falls.

Normal Goods

Goods for which demand increases as the income of individuals increases.

Demand Curve

A graphical representation of the relationship between the price of a good or service and the quantity demanded for a given period.

Normal Goods

Goods for which demand increases when income increases, and falls when income decreases, but price remains constant.