Refer to the Scenario Below to Answer the Following Questions

question 87

Multiple Choice

Refer to the scenario below to answer the following questions.
The Loaned Car (Scenario)
Colleen is a student, and her older brother has loaned her an old car. The car is in need of several repairs before she will feel comfortable driving it.
-Colleen's brother has a different view of the repairs. He assumes that the mechanic is using the best information available, but there may be other unexpected repairs that surface once he begins the work. He warns Colleen not to be too surprised if the final bill exceeds the mechanic's original estimate. Her brother's observations are based on which assumptions?

• A) rationality
• B) certainty
• C) bounded rationality
• D) escalation of commitment
• E) heuristics

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Definitions:

Fixed Face Value

The predetermined and constant value at which a financial instrument, like a bond, is redeemed by the issuer at maturity.

Dangerous Drug

A substance that has been legally recognized as posing a significant risk of harm to those who use it, often due to its potential for abuse or addiction.

FDA

The Food and Drug Administration, an agency of the U.S. Department of Health and Human Services responsible for protecting public health by ensuring safety and efficacy of drugs, biological products, and medical devices.

Liability

Legal responsibility for one's actions or inactions, which may result in financial restitution or penalties.