As CEO of a book store chain,Stuart led his company through a national expansion in the 1990s.As e-commerce expanded in the 2000s,followed by the growth of e-readers,Stuart continued expansion plans based on the chain's original model.In 2012,the company folded.What was Stuart's mistake?
A) anchoring bias
B) estimating and forecasting bias
C) sunk cost bias
D) framing bias

Question

Quizplus · Accepted Answer

Stuart likely fell victim to sunk cost bias, where he continued to invest money and resources into expanding the book store chain even as the market shifted towards e-commerce and e-readers. Instead of recognizing the changing landscape of the industry and adapting to it, Stuart may have been too focused on recouping the sunk costs of his original expansion plans. This ultimately led to the company's failure in 2012.

As CEO of a Book Store Chain,Stuart Led His Company