Question
a)Mary writes the following letter to an investment columnist: I invested quite a bit of money (R26000) in Intel stock. Of course, like most technological
a)Mary writes the following letter to an investment columnist: "I invested quite a bit of money (R26000) in Intel stock. Of course, like most technological stocks, it has been struggling, and on paper I am in trouble. Do you think it will ever reach the R80 that I paid for it? I really hate to cash it in for such a big loss and I don't trust it enough to buy it at the low price (R8) it is now trading for. I feel like the company shows promise, but I am certainly not astute in such matters - I am a dentist".
b)Las Vegas casinos offer many games. All games favour the casino. The size and elegance of the buildings reflect how much money the casinos make - and how much gamblers lose. Still, hordes of gamblers still pack the gaming tables and slot machines for hours on end. Over time, gamblers inevitably lose money, and yet they still come back the following year. What bias might cause this cycle?
c)A gambler wins a very large pot of money playing poker. In the next hand, the gambler bets heavily on a hand that is of only average quality. What bias may have caused this bet?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started