1. Gary Marks invested in mortgage backed securities that were triple A rated before a financial crisis his investment during the crisis, but has recently purchased additional mortgage backed securities because the economy has recovered and he is com Marks most likely shows signs of: a. Hindsight bias. b. Illusion of control. C. Confirmation bias. d. Mental accounting bias. 2. Mike Berry is a money manager with $10 billion in assets. Berry reads financial publications to find securities that other money managers recommend. Berry includes these stocks as part of the portfolio but not before he consults with financial advisors to obtain positive information about future security price movements. Berry appears regularly on financial news televised programs as an expert stock picker, where he is celebrated as an investing guru. Berry recently made an investment decision in which he sold equity shares after a 15% decrease in value over the past month. Which behavioral issue least likely influenced his decision? a. Herd mentality. b. Confirmation bias. c. Overconfidence. d. Anchoring 3. Nate Church is a high net worth investor with 5% of his equity allocated to MT Company (MTC). MTC experiences a 20% drop in price over the past two weeks, even though no new information has been released by the company and its daily trading volume has decreased. MTC's industry index has risen in value over the same time period by 2%. Church responds to the price decline by changing his allocation of MTC to 7.5%. Church is most likely showing signs of: a. Hindsight bias. b. Confirmation bias. C. Irrational escalation. d. Clustering illusion. 4. Mutual funds A and B are both trading at $50. The manager for fund A predicts the fund will increase by 15%, while the manager for fund B indicates an expected price of $57.50. If an investor prefers fund A he is making the behavioral mistake known as: a. Narrow framing, b. Framing. C. Anchoring d. Cognitive dissonance