The More Optimistic the Entrepreneurs, the Less Successful the Performance

question 44

Multiple Choice

The more optimistic the entrepreneurs, the less successful the performance of their new ventures. Which of the following systematic biases and errors creep into their judgments?

• A) hindsight bias
• B) anchoring bias
• C) confirmation bias
• D) availability bias
• E) overconfidence bias

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Definitions:

Net Taxes

The total taxes paid to the government after subtracting transfers and government spending directly beneficial to the taxpayer, such as social security or unemployment benefits.

Disposable Income

The finance households possess for setting aside savings and covering expenses, following income tax deductions.

Consumption

The use of goods and services by households.

Fiscal Policy

Government policies related to taxation and spending to influence the economy.