After Polly Shrum sells a stock, she avoids following it in the media. She is afraid that it may subsequently increase in price. Which behavioral characteristic is the basis for Shrum’s decision making?a. Fear of regret.b. Representativeness.c. Mental accounting.
Q: All of the following actions are consistent with feelings of regret except:a. Selling losers…
A: The question is based on the concept of behavior approach of finance and anomalies not explained by…
Q: What do you think is the main issue of conflict between the stockholders and managers?
A: There are various conflicts of interest that can impact manager's decisions to act in shareholders'…
Q: 33) Which threat may occur when, because of a close relationship, a professional accountant becomes…
A: solution concept self interest threat Self interest threat is threat arising from the…
Q: In his research into the components of ethical decision making, Rest raised the following issue:…
A: Ethics are a set of moral principles they affect how people in a society make decisions and how…
Q: Identify the reason why some individual is afraid to start a business. a. It is stress free b. It…
A: Business means doing some activity to earn some profits like buying and selling goods or…
Q: Are you interested in a career in finance? Would you have any religious or moral concerns about…
A: Finance is one of the fastest growing sector in the economy today. There is a need for finance for…
Q: What concept of bias that practices guarding some money cautiously when we mentally categorize it…
A: Since you have posted multiple questions, we have answered the first question for you. Kindly repost…
Q: Give one example of overconfidence bias in investing and how to overcome it. Thank you!
A: Overconfidence bias can be defined as the overestimation of skills and abilities by an individual.…
Q: Mr. George faced an ethical dilemma when his manager ordered him to send the customers data to…
A: When some one is working in company under boss , then he has to follow his command , otherwise he…
Q: Mr. Bader is leaving the accounting practice to become the Finance Director of a client company. The…
A: The principles of the code of ethics are: Objectivity Integrity Confidentiality Professional…
Q: Many companies believe that a going-concern opinion is a self-fulfilling prophecy (i.e., when a…
A: Going Concerned:- It is to be expected that when a business starts it will continue its operation…
Q: 2 (a)There is a conflict of interest between stockholders and managers. In theory, stockholders are…
A: Shareholders are the people who invest money in the business for the purpose of earning returns.…
Q: You are the founder of IGRO, an Internet firm that delivers groceries. a. Give an example of an…
A: (a.) IDIOSYNCRATIC RISK- Idiosyncratic risk may be a style of investment risk that's endemic to a…
Q: Assume that an investor plan to invest in SONY company and after investigation the investor finds…
A: Fundamental analysis- is a method of determining the intrinsic value of the stock of a company. If…
Q: What is the possible agency conflict between inside owner/managers and outside shareholders? What…
A: What is the possible agency conflict between inside owner/managers and outside shareholders?…
Q: Having inaccurate financial statements that can harm society would correspond with the ethical…
A: Financial statement: The income statement, cash flow statement, and balance sheet. Footnotes on…
Q: Stephen's friend Jane is trying to decide if she should purchase stock from a company that makes a…
A: Diversification refers to the process of investing money in different assets in order to diversify…
Q: Economic stakeholders are all those who invest in the economic traffic with the business and who…
A: There are two types of stakeholder- Economic and social stakeholder
Q: When the existing accountant doesn't reply to the proposed professional accountant after a…
A: r) Ans. True As per the rules of their professional body to inform you of any circumstances of which…
Q: In her book The Seven Signs of Ethical Collapse, Jennings explains: “When an organization collapses…
A: Given information is: In her book The Seven Signs of Ethical Collapse, Jennings explains: “When an…
Q: Harry, a friend of yours, is taking a course in economics, and has become confused by some of the…
A: Savings is defined as the amount of money left over after a person’s expenditure is taken out of his…
Q: Below are some factors that favor accepting a new client and some that are unfavorable. Choose every…
A: When an auditor firm decides to audit a new client, it must verify that this audit…
Q: Some accountants argue that they should be allowed to invest in a company's stock as long as they…
A: An audit entails a thorough examination and a written report. The auditing and vouching procedure…
Q: Agency Theory suggests: A) The interests of the managers are aligned with the interest of…
A: Agency theory tries to emphasize on solving the conflicts between management and shareholders of a…
Q: Which of the following can impose serious economic consequences on a businessman? O a. Having more…
A: Sole proprietor or businessman has a disadvantage of unlimited liability under sole proprietorship…
Q: At a lunch with some business associates, you discuss the reason for the relationship between the…
A: Stock market is a place where shares of companies are traded. Companies do not work in isolation…
Q: Many financial managers and corporate officers are often criticized for (a) poor decisions, (b) lack…
A: As your business grows, you'll move from a flat structure structure, or one wherever many key…
Q: Select the best logical fallacy for the given statements. A. Ad hominem B. Appeal to…
A: Logical fallacies are arguments which are not correct in reality and are invalid.
Q: How are conflicts between the shareholders and the management created? Which of the following is…
A: Management group might be more ready to take on more significant levels of chance, while…
Q: Which of the following statements is most often the case? a0Socially responsible investing gives…
A: The business which are socially responsible succeed in creating faith among the Public. The Public…
Q: Do you think there are any circumstances when you should go outside the company to report financial…
A: Being the Ethical Professional Practice includes a confidentiality standard requires we should not…
Q: This corporate con stated that she stole from the company because she believed it was "okay" to take…
A: The fraud triangle represents the three basic reasons which influence the person to commit the…
Q: Do some research (use sources other than your prescribed textbook) and explain why it is important…
A: Business ethics play a very important role in financial management. It is very essential for…
Q: Students will occasionally comment that they are studying to become accountants yet never mention…
A: Within the accounting profession, accounting information systems are crucial as they have a variety…
Q: of the factors that can affect the tolerance for risk and investment choices, match each investor to…
A: Conservative investment refer to those investments options that usually bears lower level of risk…
Q: Why do you think active short sellers publish or disclose their short positions despite the…
A: A shareholder, sometimes known as a stockholder, is someone who owns at least one share of a…
Q: Example he reporter writing an article will interview only those experts who support his views. Con…
A: Answer: As per Q/A guideline first question has been answered. The correct influence is affected on…
Q: Explain the links between stock price, intrinsic value, and executive compensation
A: Hi There, Thanks for posting the questions. As per our Q&A guidelines, must be answered only one…
Q: t is creative accounting and how does it work? Provide three common techniques of creative…
A: Creative accounting is about accounting methods that follow the law but don't do what those laws and…
Q: Write a brief description of the logic behind the development of the time value formula for…
A: Since you have asked multiple questions, we will solve the first question for you. If youwant any…
After Polly Shrum sells a stock, she avoids following it in the media. She is afraid that it may subsequently increase in price. Which behavioral characteristic is the basis for Shrum’s decision making?
a. Fear of regret.
b. Representativeness.
c. Mental accounting.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- Jill Davis tells her broker that she does not want to sell her stocks that are below the price she paid for them. She believes that if she just holds on to them a little longer they will recover, at which time she will sell them. Which behavioral characteristic is the basis for Davis’s decision making?a. Loss aversion.b. Conservatism.c. Representativeness.After discussions with Josh, Carrington and Genevieve agree that they would like to try to increase the value of the company stock. Like many small business owners, they want to retain control of the company and do not want to sell stock to outside investors. They also feel that the company's debt is at a manageable level and do not want to borrow more money, What steps can they take to increase the price of the stock? Are there any condi- tions under which this strategy would not increase the stock price?After discussions with Josh, Carrington and Genevieve agree that they would like to try to increase the value of the company stock. Like many small business owners, they want to retain control of the company and do not want to sell stock to outside investors. They also feel that the company’s debt is at a manageable level and do not want to borrow more money. What steps can they take to increase the price of the stock? Are there any conditions under which this strategy would not increase the stock price?
- Stephen's friend Jane is trying to decide if she should purchase stock from a company that makes a good product that is appropriately priced by the market. Stephen has a diversified portfolio however Jane does not. Based on the relationship between risk and return should Stephen be willing to pay a higher price for the stock than Jane? ExplainIn his research into the components of ethical decision making, Rest raised the following issue: Assuming someone possesses sound moral reasoning skills, “Why would they ever chose the moral alternative, especially if it involves sacrificing some personal value or suffering some hardship? What motivates the selection of moral values over other values?” How does Rest’s model deal with such a question? How would you answer it from the point of view of an accounting professional?Carrington and Genevieve agree that they would like to try to increase the value of the company stock. Like many small business owners, they want to retain control of the company and do not want to sell stock to outside investors. They also feel that the company's debt is at a manageable level and do not want to borrow more money. What steps can they take to increase the price of the stock? Are there any conditions under which this strategy would not increase the stock price?
- Managers often complain that the stock market is short-sighted and focused on accounting earnings. In your post, make a case to convince your manager that this view is either true or not true.1. Do you think that financial managers should be held to a higher standard of ethical behavior? 2. In the video on ethics and my article from the Conway Daily Sun, there were several examples of unethical behavior, Please discuss a real life example of unethical behavior either from your personal experience or from the news. What do you think can be done to change the unethical behavior, or do you think it can't be stopped?Write a brief description of the logic behind the development of the time value formula for annuities. Why does stock-based compensation create a moral hazard for executives?
- It is an axiom that may be characterized by managers making decisions that conflict with the best interest of the shareholders. a. the risk-return trade-off b. the agency problems c. the curse of competitive markets d. stockholders versus managersWhich strategy would be best for Kelly to deploy if she thinks the stock market will decline and she wants to protect the downside, while maintaining any upside if she is wrong about the market situation: a Protective puts b Covered calls c Zero-cost collarsExplain the links between stock price, intrinsic value, and executive compensation Discuss the importance of business ethics and the consequences of unethical behavior.