Marzella Corp. is analyzing a project that involves expanding the firm into a new product line.

Assume you are an overconfident manager. You are most apt to do which one of the following more so than you would if you were not overconfident?    A.  research a project more thoroughly before committing funds to commence it B.  accept risky projects that turn out to be less profitable than you expected C.  wait until new technology proves its worth before incorporating it into your firm's operations D.  avoid mergers and acquisitions E.  invest excess company cash more conservatively than your peers at other firms Refer to section 22.2

16.

Marzella Corp. is analyzing a project that involves expanding the firm into a new product line. The project includes the construction of a new manufacturing facility and the creation of a new distribution system. The project's financial projections will tend to have which one of the following characteristics if the person compiling those projections suffers from overoptimism?    A.  overestimated construction costs B.  overestimated expenses C.  overestimated net present values D.  underestimated profits E.  underestimated sales estimates Refer to section 22.2

17.

When weighing a decision, Kate places greater emphasis on opinions that match her own than she does on opinions offered by others that disagree with her personal point of view. Kate illustrates which one of the following?    A.  frame dependence B.  overconfidence C.  gambler's fallacy D.  confirmation bias E.  overoptimism Refer to section 22.2

18.

Kaiser Marketing recently conducted a survey on behalf of Health Products. The primary purpose of the survey was to illustrate to Health Products that it was relying on results of previous studies that, according to Kaiser, were unreliable due to the wording of the survey questions. To prove this point, Kaiser conducted a two-prong survey. In the first prong, the survey questions were worded such that the answers tended to sound positive. In the second prong, the survey questions were re-worded such that the answers tended to convey a negative feeling. Both sets of survey questions should have resulted in similar results as the information solicited was essentially identical. However, the survey results varied significantly. This survey best illustrates which one of the following?    A.  mental accounting B.  overconfidence C.  self attribution bias D.  confirmation bias E.  frame dependence Refer to section 22.3