AAFM CWM_LEVEL_2 Exam - Topic 6 Question 87 Discussion

Actual exam question for AAFM's CWM_LEVEL_2 exam

Question #: 87
Topic #: 6

Section B (2 Mark)

Fifteen Year ago, Sandeep set up his initial allocation in her defined contribution plan by placing an equal amount in each asset class and never changed it. Over time, he increased his contribution by 3 % per year until he reached maximum amount allowed by law. Which of the following biases that Sandeep suffers from?

ARepresentativeness Bias

BStatus Quo Bias

CAvailability Bias

DConfirmation Bias

Show Suggested Answer

Suggested Answer: D

by Latrice at Sep 19, 2024, 04:20 AM

Limited Time Offer

25%

Off

Get Premium CWM_LEVEL_2 Questions as Interactive Web-Based Practice Test or PDF

Contribute your Thoughts:

Submit Cancel

Garry

9 months ago

I thought he might be suffering from Availability Bias, but I see your point.

upvoted 0 times

...

Merissa

10 months ago

Sounds like he just got comfortable with his choices.

upvoted 0 times

...

Cyndy

10 months ago

Wait, are you sure? What about Representativeness Bias?

upvoted 0 times

...

Youlanda

10 months ago

I agree, sticking to the same plan for 15 years is a classic case.

upvoted 0 times

...

Lavonda

10 months ago

Definitely Status Quo Bias. He never changed his allocation!

upvoted 0 times

...

Leota

11 months ago

Confirmation Bias seems off here, but I can't quite recall how Availability Bias applies. Maybe it's about not considering other options?

upvoted 0 times

...

Launa

11 months ago

I practiced a question similar to this one, and I think it was about how people tend to stick with their original choices. That sounds like Status Quo Bias to me.

upvoted 0 times

...

Dahlia

11 months ago

I'm not entirely sure, but I remember something about Representativeness Bias being related to making decisions based on stereotypes. That doesn't seem to fit here.

upvoted 0 times

...

Launa

11 months ago

I think Sandeep might be suffering from Status Quo Bias since he never changed his initial allocation. It seems like he just stuck with what he started.

upvoted 0 times

...

Rosann

11 months ago

I'm feeling pretty confident about this one. The details about Sandeep's initial equal allocation and his continued adherence to that strategy over time point to the Status Quo Bias as the correct answer. I'll select that option on the exam.

upvoted 0 times

...

Dexter

11 months ago

This is a good question to test our understanding of behavioral biases. I think the Status Quo Bias is the most likely answer here, as Sandeep seems reluctant to make changes to his investment strategy even as his circumstances evolve.

upvoted 0 times

...

Tyisha

11 months ago

Okay, I've got it! Based on the information that Sandeep never changed his initial allocation, even as he increased his contributions, I believe the correct answer is Status Quo Bias. He's sticking to his original investment strategy despite changes over time.

upvoted 0 times

...

Edward

11 months ago

Hmm, I'm a bit unsure about this one. The question mentions Sandeep's initial allocation and increased contributions over time, but I'm not sure which bias that corresponds to. I'll need to think this through carefully.

upvoted 0 times

...

Nenita

11 months ago

This seems like a straightforward question about behavioral biases. I think the key is to identify the bias that Sandeep is exhibiting based on the details provided in the question.

upvoted 0 times

...

Gearldine

11 months ago

This looks like a pretty straightforward BPMN process testing question. I think I can handle this - the key is to identify the minimal set of test cases that cover all the possible process tasks.

upvoted 0 times

...

Adrianna

1 year ago

Status Quo Bias, no doubt. Sandeep's stuck in his ways like a stubborn mule. Maybe he's just afraid of change, or maybe he's too lazy to rebalance. Either way, he's missing out on potential growth.

upvoted 0 times

...

Clorinda

1 year ago

I'm going with Status Quo Bias too. Sandeep's unwillingness to adjust his allocation despite increasing contributions is a textbook example. Though I'm a little jealous he's maxing out his contributions - must be nice!

upvoted 0 times

...

Chantell

1 year ago

Haha, Sandeep must be a big fan of the 'set it and forget it' approach. Looks like he's suffering from a classic case of Status Quo Bias. Someone get this guy a financial advisor, stat!

upvoted 0 times

Georgiann

1 year ago

C) Availability Bias

upvoted 0 times

...

Dorthy

1 year ago

B) Status Quo Bias

upvoted 0 times

...

Lashonda

1 year ago

A) Representativeness Bias

upvoted 0 times

...

Ma

1 year ago

I think it's Representativeness Bias. Sandeep is assuming that the initial allocation is representative of the best strategy, even though market conditions have likely changed over time.

upvoted 0 times

Jin

1 year ago

I think it's more about Sandeep being comfortable with his current allocation and not wanting to change.

upvoted 0 times

...

Reita

1 year ago

B) Status Quo Bias

upvoted 0 times

...

Felicitas

1 year ago

I agree, Sandeep is sticking to his initial allocation without considering changes in the market.

upvoted 0 times

...

Micheal

1 year ago

A) Representativeness Bias

upvoted 0 times

...

Adrianna

1 year ago

Sandeep definitely has a case of Status Quo Bias. He's been sticking to the same allocation for 15 years, even though his contributions have increased. He's just too comfortable with the familiar to make changes.

upvoted 0 times