Someone Who Commits the Fallacy of Composition Is Likely to Assume

question 104

Multiple Choice

Someone who commits the fallacy of composition is likely to assume that:

• A)the simplest model is the best predictor.
• B)event B,which followed event A,was caused by event A.
• C)event B,which followed event A,was not necessarily caused by event A.
• D)what is true for the individual is also true for the group.
• E)what is true for the individual is not necessarily true for the group.

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Definitions:

Amortized

A process of paying off debt in regular installments over a period of time, where each payment is partially principal and partially interest.

Compounded Semi-annually

Refers to the process of calculating interest on both the initial principal and the accumulated interest from previous periods twice a year.

Amortization Schedule

A table detailing each periodic payment on an amortizing loan (typically a mortgage), as well as how much of each payment is interest versus principal and the balance remaining after each payment.

Compounded Semi-annually

Interest calculation method where interest is added to the principal sum of a loan or deposit twice a year, resulting in interest earning interest.