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Betsy notices that when her favorite college softball team has a winning record, the value of her stock portfolio increases. Betsy assumes that the success of her favorite college softball team has a positive influence on the value of her stock portfolio and decides to buy stock when her favorite team has winning record and to sell stock when it has a losing record. Betsy's assumption is an example of:

a) the fallacy of false cause.
b) the fallacy of division.
c) the fallacy of composition.
d) declining opportunity cost.

Sagot :

Betsy's assumption is an example of the fallacy of false cause. (option a).

What is the fallacy of false cause?

The fallacy of false is a type of fallacy where a person establishes a false or imagined link between two random events based on perceived connectedness.

Betsy assumes that  that the success of her favorite college softball team has a positive influence on the value of her stock portfolio based on the fact that the time when her portfolio increases in value coincides with her  favorite college softball team having a winning record.

The fallacy of false cause is not based on economic theory and thus can have unintended negative implications. To determine if a person is making a decision based on the fallacy of false cause, the person should ensure that there is an economic theory backing their reasoning.

To learn more about the fallacy of false cause, please check: https://brainly.com/question/6987057

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