1) When investors disregard their own information which is incomplete and follow the momentum activities of other market participants, they could inadvertently cause a financial bubble by transmitting inaccurate information with each additional trade. This phenomenon is called ____

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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1) When investors disregard their own information which is incomplete and follow the momentum activities of other market participants, they could inadvertently cause a financial bubble by transmitting inaccurate information with each additional trade. This phenomenon is called ______________.

 

Multiple Choice
  • Asymmetric information.

  • Attribution bias.

  • Systematic bias.

  • Overconfidence.

  • Information cascade.

     

    2) Canada Revenue Agency requires firms to claim only one-half of the incremental capital cost of a new project in its first year for tax purposes. This rule is called the _________.

    Multiple Choice
    • CCA rule.
    • Half-CCA rule.
    • Two-year rule.
    • Half-year rule.
    • Incomplete CCA rule.

    3)Alternative ways of calculating operating cash flows are the bottom-up approach, the top-down approach, and the tax shield approach.

    True/False? 
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