Tom Is Considering Moving to a New City

question 39

Multiple Choice

Tom is considering moving to a new city. He reads that the employment rate in that city is 90 percent, which he thinks is very favorable. Ted is considering moving to the same city, but he reads that the unemployment rate is 10 percent, 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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Definitions:

Accelerate Costs

Costs that increase at a rate faster than usual, often due to rapid growth or expansion activities.

Delay Sales

A strategy or situation in which the sale of goods or services is postponed to a later time, possibly in anticipation of more favorable market conditions or prices.

Encrypted Servicing

The process of providing services through secure, encrypted communications to protect sensitive information.

Faulty Design

Describes a product, structure, or system that has inherent flaws or errors in its design, leading to inefficiency, malfunction, or potential hazards.