CFA CFA Level 3 Question of the Week: Level 3 – Portfolio Management (5)

Question of the Week: Level 3 – Portfolio Management (5)

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    • Avatar of MarkMeldrumMarkMeldrum
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        A belief perseverance bias, in which people maintain their prior views or forecasts by inadequately incorporating new information, is known as:

        • confirmation bias.
        • conservatism bias.
        • representative bias.
      • Avatar of MarkMeldrumMarkMeldrum
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          The correct answer is B:

          Conservatism bias is a belief perseverance bias, in which people maintain their prior views or forecasts by inadequately incorporating new information.

          Confirmation bias is a belief perseverance bias, in which people tend to look for and notice what confirms their beliefs and to ignore or undervalue what contradicts their beliefs.

          Representativeness bias is a belief perseverance bias, in which people tend to classify new information based on past experiences and classifications.

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