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21.
Steve purchased a stock last year for $34 a share. The stock increased in
value to $36 a share before declining to its current value of $30. Steve has
decided to sell the stock, but only if he can receive $34 a share or better.
Steve is suffering most from which one of the following behavioral
conditions?
22.
Mike is a stock broker and financial planner. Phil is one of Mike's clients.
Phil prefers to meet with Mike just once a year to review his investment
portfolio. At their most recent meeting, Phil stated he believes the stock
market is going to decline in value over the next six months. Thus, Phil
instructed Mike to sell every stock he owns that is currently worth more
than what he paid to purchase it. Phil also instructed Mike to retain any
stock that would create a capital loss if sold. Phil is displaying the behavior
known as:
23.
Over the past six months, you have watched as your parent's retirement
savings have declined in value by 45 percent due to a severe financial
market downturn. As a result, you have decided that you will never invest in
stocks for your own retirement but will instead keep all of your money in an
insured bank account. Which behavior characteristic have you developed as
a result of the market downturn?
24.
Ramon opened a combination laundry and dry cleaning establishment three
years ago. Due to his excellent service and reasonable prices, his business
has grown and is doing quite well financially. He has considered expanding
this business by opening another location but keeps putting off that
decision for fear that the second location will not be a success. Ramon is
currently displaying which one of the following behavior characteristics?
25.
Phyllis is planning for her retirement in fifteen years. She knows that she
can currently live reasonably well on $38,000 a year given that she is debt-
free. Based on her family history she expects to die ten years after she
retires. Thus, she computes her retirement need as $38,000 a year for 10
years. Which one of the following behaviors applies to Phyllis?
26.
Kate is attempting to sell her house for $260,000. Fred lives across the
street in an identical house. Fred recently stated to his wife that Kate's
house is probably worth only $250,000 but that once she sells her house, he
would like to put their house on the market at $285,000 and then move into
a condominium. Which one of the following behaviors applies to Fred?
27.
You recently overheard your boss telling someone that if he'd actually
crunched some numbers and done some analysis instead of just going with
his instincts that he never would have opened the new store in Centre City.
Which one of the following caused your boss to make a bad decision?
28.
Roger's Meat Market is a chain of retail stores that limits its sales to fresh-
cut meats. The stores have been very profitable in northern cities. However,
when two stores were opened in the south, both lost money and had to be
closed. Roger, the owner, has now concluded that no southern-based store
should be opened as it would not be profitable. Which one of the following
applies to Roger?
29.
Up until three years ago, A.C. Dime opened an average of ten new retail
stores a year. One of those stores had to be closed within two years due to
poor sales. This 90 percent success ratio was fairly steady for over 30 years.
Starting three years ago, the firm has opened 40 new stores and every one
had significant profits within 6 months. Management believes their recent
success is not just a random event and that all future stores will be
profitable. Thus, the managers have decided to open a minimum of 15 new
stores each year. The managers are suffering from:
30.
You are employed as a commission-based sales clerk for a cosmetics retail
store. You know that on average, exactly 50 percent of the customers that
enter your store will make at least one purchase. Thus far this morning, you
have waited on eight customers without making a single sale. You are
convinced that the next customer you wait on will buy something. This
belief is known as:
31.
You don't particularly like to shop so only go to the mall once a month. To
help make the trek more enjoyable, you always have lunch at the restaurant
located inside the mall. Since you are such a creature of habit, you always
order the same meal. You've noticed that the price of that meal has
increased every time you have been there over the past six months. Thus,
you expect the meal to increase in price next month. This is an example of
which one of the following?
32.
You started an online business three weeks ago. Thus far, you have
averaged 10 sales a day, which is one sale for every five hits. You are now
considering giving up your day job and becoming a full-time online retailer.
You have calculated the amount of income you can earn based on 10 sales
a day and know that level of income would support you in a comfortable
fashion. The belief that you will have 10 sales per day on average if this
becomes your full-time occupation is based on which one of the following?
33.
You are a hard-charging manager who doesn't really like to sit at a desk for
too long. You prefer to gather information quickly, make a decision, and
move on to the next item on your agenda. Which one of the following
applies to you?
