Question

Against his financial advisor’s advice, Frank has decided to invest his money in some risky stocks because he once made quite a bit of money in the stock market. His decision illustrates __________.
A.
the representativeness heuristic
B.
overconfidence
C.
the availability heuristic
D.
confirmation bias

Answer 1

I believe the answer is: representativeness heuristic

representativeness heuristic refers to the act of making judgement about a certain probability under uncertain situation. Representativeness heuristic often being done when investors want to accumulate wealth in the fastest way possible, even though the risk of losing all their wealth become larger.

Answer 2

Answer: A

Explanation:

Against his financial advisor’s advice, Frank has decided to invest his money in some risky stocks because he once made quite a bit of money in the stock market. His decision illustrates