Tom Is Considering Moving to a New City

question 134

Multiple Choice

Tom is considering moving to a new city.He reads that the employment rate in that city is 90%,which he thinks is very favorable.Ted is considering moving to the same city,but he reads that the unemployment rate is 10%,which he thinks is unacceptably high.Why would Tom and Ted reach such different conclusions based on the same statistics?

• A)Tom received inFormation that was framed in a favorable way,whereas Ted received the exact same inFormation but framed in an unfavorable way.
• B)Tom used base-rate data,but Ted used anecdotal data when Forming his decision.
• C)Tom relied on the representativeness heuristic when making his decision,whereas Ted relied on the availability heuristic.
• D)Neither Tom nor Ted fully considered other cities,so both their judgments were guided by the conjunction fallacy.

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Legal Obligations

Commitments or duties bound by law that require an individual or company to act or refrain from acting in a certain manner.

Other Comprehensive Income

Earnings derived from non-operational activities that are not included in net income, recorded in equity.

Revaluation

Revaluation is an adjustment to the carrying value of a currency, asset, or liability to reflect its current market value.

Revaluation

The process of adjusting the carrying value of an asset or liability to reflect its current market value.