Psychology CFP Test with all Correct & 100% Verified
Answers |Latest Version |Already Graded A+
1. what is bias
behav-ioral
finance
2. what is
psycholo-gy
3. what are
heuris-tics
4. what is
anchor-ing
5. what is
attach-ment
bias
6. what is
availabili-ty
bias
7. what is
cognitive
dissonance
8. what is
confirma-tion
1/
23
, Psychology CFP Test with all Correct & 100% Verified
Answers |Latest Version |Already Graded A+
the study of how psychology with timing, only the emotional aspect of it
attects finance
-tendency to make decisions based on the information that is most readily
available or easy to recall, not necessarily relevant
-basis for human desire, -ease of recall (doesn't have to happen recently nor does it need to be an
goals, and motivations emotional trigger)
-basis for human
errors that stem from -discord felt when investors make decisions contrary to their actual beliefs
perceptual illusions, (most times people will then change their stated beliefs to match)
overconfidence, over- -ex conservative investor invests in crypto, then say that they are an
reliance on rules of aggressive investor
thumb and emotions
-human tendency to accept any information that confirms our
-act of enabling people to preconceived posi-tion and deny information that does not support our
learn things on their own preconceived notion
(almost like trial and error -ex hear good things about a stock, research it, and then only look about
-mental short cut or rule of the good things about the stock and ignore the bad
thumb investors use to
simplify complex decisions
the tendency of investors
to become attached to a
specific price as the fair
value of a holding
-ex. buy at a certain price and
the price drops but you
continue to believe the fair
value is at the price you
bought it at
-holding onto an investment
for emotional reasons
-ex. family member gave you
a stock, doesn't have to do
2/
23
, Psychology CFP Test with all Correct & 100% Verified
Answers |Latest Version |Already Graded A+
9. what is -same thing as confirmation bias
conge-niality
bias
-investor tends to diversify evenly across whatever options are presented
10. what is
-don't really go out of their way to diversify
diversifi-
-ex diversify within 401k based on the options that are provided within
cation errors
that bucket
tendency to place more value on items an investor owns already than
11. what is
items they do not
endow-ment
-no emotion or sentimentality, just based on the length of time
bias
-same thing as endowment bias
12. what is
divesture
aversion
13. what is familiarity -bias to what the customer knows based on their experience
bias -ex buy apple stock because you own an iphone
14. what is fear of re- -tendency to take no action rather than risk making the wrong one
gret -end up doing nothing
15. what is the -tendency for people to prefer fixed payment streams vs variable ones
flat rate bias-want the guarantee
16. what is framing -tendency to make decisions based on how information is presented,
which can often be a narrow scope, rather than the complete set of
facts
-way information is presented
-change perception through presentation
17. what is gambler's -individual believes that the onset of certain random events is less
likely to happen
3/
23
Answers |Latest Version |Already Graded A+
1. what is bias
behav-ioral
finance
2. what is
psycholo-gy
3. what are
heuris-tics
4. what is
anchor-ing
5. what is
attach-ment
bias
6. what is
availabili-ty
bias
7. what is
cognitive
dissonance
8. what is
confirma-tion
1/
23
, Psychology CFP Test with all Correct & 100% Verified
Answers |Latest Version |Already Graded A+
the study of how psychology with timing, only the emotional aspect of it
attects finance
-tendency to make decisions based on the information that is most readily
available or easy to recall, not necessarily relevant
-basis for human desire, -ease of recall (doesn't have to happen recently nor does it need to be an
goals, and motivations emotional trigger)
-basis for human
errors that stem from -discord felt when investors make decisions contrary to their actual beliefs
perceptual illusions, (most times people will then change their stated beliefs to match)
overconfidence, over- -ex conservative investor invests in crypto, then say that they are an
reliance on rules of aggressive investor
thumb and emotions
-human tendency to accept any information that confirms our
-act of enabling people to preconceived posi-tion and deny information that does not support our
learn things on their own preconceived notion
(almost like trial and error -ex hear good things about a stock, research it, and then only look about
-mental short cut or rule of the good things about the stock and ignore the bad
thumb investors use to
simplify complex decisions
the tendency of investors
to become attached to a
specific price as the fair
value of a holding
-ex. buy at a certain price and
the price drops but you
continue to believe the fair
value is at the price you
bought it at
-holding onto an investment
for emotional reasons
-ex. family member gave you
a stock, doesn't have to do
2/
23
, Psychology CFP Test with all Correct & 100% Verified
Answers |Latest Version |Already Graded A+
9. what is -same thing as confirmation bias
conge-niality
bias
-investor tends to diversify evenly across whatever options are presented
10. what is
-don't really go out of their way to diversify
diversifi-
-ex diversify within 401k based on the options that are provided within
cation errors
that bucket
tendency to place more value on items an investor owns already than
11. what is
items they do not
endow-ment
-no emotion or sentimentality, just based on the length of time
bias
-same thing as endowment bias
12. what is
divesture
aversion
13. what is familiarity -bias to what the customer knows based on their experience
bias -ex buy apple stock because you own an iphone
14. what is fear of re- -tendency to take no action rather than risk making the wrong one
gret -end up doing nothing
15. what is the -tendency for people to prefer fixed payment streams vs variable ones
flat rate bias-want the guarantee
16. what is framing -tendency to make decisions based on how information is presented,
which can often be a narrow scope, rather than the complete set of
facts
-way information is presented
-change perception through presentation
17. what is gambler's -individual believes that the onset of certain random events is less
likely to happen
3/
23
