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This test consists of 15 multiple choice questions and 5 short answer questions.

Multiple Choice Questions

1. What psychologist conduted an experiment wherein he recruited fans of professional basketball and elicited judgments concerning the winner of the NBA playoffs?
(a) Craig Fox.
(b) Larry Jacoby.
(c) Shane Frederick.
(d) Nassim Taleb.

2. The author presents several examples in Chapter 26 that demonstrate that there is no loss aversion in what kinds of interactions?
(a) Routine commercial exchanges.
(b) Gambling exchanges.
(c) Non-material interactions.
(d) Large investments in similar firms.

3. Who designed the study along with Kahneman that involves two patients undergoing a painful colonoscopy?
(a) Don Redemeier.
(b) Baruch Fischhoff.
(c) Christopher Hsee.
(d) John List.

4. Who wrote that "chances of rare events (such as the burst of housing bubbles) receive less impact than they deserve according to their objective probabilities" (639)?
(a) Craig Fox.
(b) Jim Collins and Jerry I. Porras.
(c) Ralph Hertwig and Ido Erev.
(d) John Gottman.

5. In the author's description of the cold-pressor experiment, how long did the short episode consist of?
(a) 2 minutes.
(b) 30 minutes.
(c) 60 seconds.
(d) 30 seconds.

6. In the following example from Chapter 30, the author posits the following in regards to a person choosing a marble from an urn. The red marbles win a prize. "Urn A contains 10 marbles, of which 1 is red. Urn B contains 100 marbles, of which 8 are red" (631). What are the chances of winning in Urn B?
(a) 20%.
(b) 8%.
(c) 16%.
(d) 10%.

7. In what branch of the military did the author complete service?
(a) U.S. Marines.
(b) French Navy.
(c) Israeli Army.
(d) British Navy.

8. The author notes in Chapter 30 that what "is similar to the psychology of terrorism" (619)?
(a) "The psychology of anchors."
(b) "The psychology of high-prize lotteries."
(c) "The psychology of statistical means."
(d) "The psychology of narrative fallacies."

9. Who first demonstrated the hindsight bias as a student in Jerusalem?
(a) Malcolm Gladwell.
(b) John List.
(c) Baruch Fischhoff.
(d) Christopher Chabris and Daniel Simons.

10. In utility theory, the utilty of a gain is assessed by comparing what?
(a) The heuristics of the subject.
(b) The utilities of two states of wealth.
(c) The axioms invested in the states of wealth.
(d) The base rates of the subject.

11. Who is the author of Clinical vs. Statistical Prediction: A Theoretical Analysis and a Review of the Evidence?
(a) Malcolm Gladwell.
(b) Jerry I. Porras.
(c) Baruch Fischhoff.
(d) Paul Meehl.

12. How many participants were involved with the author's study on the pain of colonoscopies?
(a) 95.
(b) 154.
(c) 123.
(d) 10.

13. Who coined the term "denominator neglect"?
(a) Paul Slovic.
(b) Shane Frederick.
(c) Craig Fox.
(d) John Gottman.

14. The author points out in Chapter 31 that professional golfers putt more successfully when doing what?
(a) Trying to achieve a birdie while ignoring the bogey.
(b) Avoiding a bogey rather than trying to achieve a birdie.
(c) Avoiding a birdie rather than trying to achieve a bogey.
(d) Trying to achieve a birdie while avoiding a bogey.

15. What creates an asymmetry that makes agreements difficult to reach?
(a) Loss aversion.
(b) Narrative fallacy.
(c) Theory-induced blindness.
(d) Endowment effect.

Short Answer Questions

1. What is the conclusion of the paper "Trading is Hazardous to Your Health"?

2. In assessing the stock market, the author asserts that skill in evaluating the business prospects of a firm is not sufficient for stock trading. Traders often lack the skill to answer what crucial question?

3. Who wrote the bestseller book Blink?

4. What term introduced by Nassim Taleb describes how flawed stories of the past shape our views of the present and the future?

5. How many pairs of competing companies are analyzed in Built to Last?

(see the answer keys)

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