A Survey Among Tenants of Shared Apartments Asked Each Tenant

question 14

Multiple Choice

A survey among tenants of shared apartments asked each tenant what percentage of the cleaning around the apartment he or she does.The survey found that aggregating the percentages for each apartment produces an average of much more than 100%.This result may be due to what bias?

• A)Ease of recall.
• B)Insensitivity to sample size.
• C)Insensitivity to base rates.
• D)The conjunction fallacy.

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Definitions:

Product-Variety Externality

External effects that occur when the introduction of new products benefits consumers more than the producers, typically by increasing the variety of goods available.

Business-Stealing Externality

Business-Stealing Externality occurs when a new entrant in a market captures a portion of the incumbent firm's customers, potentially leading to costs not accounted for in the entrant's decisions.

Spillover Benefits

These are benefits experienced by those who are not directly involved in economic transactions or activities; they result from the positive externalities of such transactions.

Advertising

The act of promoting products, services, or brands through various media channels to inform, persuade, and influence purchasing decisions.