The optimistic bias would explain why Sarah, a graduating student, believes she will be less likely than her peers to experience hardship from a difficult job market.

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The optimistic bias refers to the tendency for individuals to believe that they are less likely to experience negative events compared to others. In this case, Sarah's belief that she will be less affected by a difficult job market than her peers is an example of this bias.

The Optimistic Bias Would Explain Why Sarah, a Graduating Student