3. Discuss your reaction for the following status quo bias scenarios Question 1: Your financial advisor presents you with a plan to rebalance your portfolio. This rebalancing would require you to make a number of substantial changes in your portfolio, which may even involve triggering taxable events that are not pleasant but are quite necessary to get your portfolio where it needs to be. Which of the following is most likely? a. You take action on the recommendation immediately. b. You say you'll think about it to do an honest review and get back to your advisor in a week- and you actually will get back to your advisor in that time. c. You say you'll think about it" and get back to your advisor in a weekand you probably won't get back to your advisor and may not for three to six months because you tend to agonize over making substantial changes like this. Question 2: Your investment portfolio contains a certain high-quality corporate bond. The bond has been providing income for you, and you are happy with it. Your financial advisor analyzes your bond holdings and recommends that you replace the corporate bond with a municipal bond of comparable quality, estimating that you will obtain a better return after capital gains taxes and fees. You aren't familiar with this municipal bond. What is your most likely response? a. I will sell the corporate and purchase the municipal bond. b. I will keep things as they are. 3. Discuss your reaction for the following status quo bias scenarios Question 1: Your financial advisor presents you with a plan to rebalance your portfolio. This rebalancing would require you to make a number of substantial changes in your portfolio, which may even involve triggering taxable events that are not pleasant but are quite necessary to get your portfolio where it needs to be. Which of the following is most likely? a. You take action on the recommendation immediately. b. You say you'll think about it to do an honest review and get back to your advisor in a week- and you actually will get back to your advisor in that time. c. You say you'll think about it" and get back to your advisor in a weekand you probably won't get back to your advisor and may not for three to six months because you tend to agonize over making substantial changes like this. Question 2: Your investment portfolio contains a certain high-quality corporate bond. The bond has been providing income for you, and you are happy with it. Your financial advisor analyzes your bond holdings and recommends that you replace the corporate bond with a municipal bond of comparable quality, estimating that you will obtain a better return after capital gains taxes and fees. You aren't familiar with this municipal bond. What is your most likely response? a. I will sell the corporate and purchase the municipal bond. b. I will keep things as they are