Which of the Following Is Not a Common Mistake Made

question 137

Multiple Choice

Which of the following is not a common mistake made by consumers?

• A)the failure to take into account the implicit costs of an activity
• B)the failure to ignore sunk costs
• C)being overly optimistic about their future behavior
• D)being overly pessimistic about their future behavior

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Definitions:

Offset Conditions

Conditions that allow entities to negate or counterbalance one position with another, commonly used in accounting and finance to manage risk or net-off liabilities against assets.

Different Financial Instruments

Various types of investment assets, including stocks, bonds, derivatives, and mutual funds, that provide a way for individuals and businesses to invest, finance operations, or manage risk.

Financial Instrument

A contract that leads to the creation of a financial asset for one party and results in a financial liability or equity instrument for another party.

Market Risk

The risk that the value of a financial instrument will fluctuate because of changes in foreign exchange rates, market interest rates or some other market prices.