Lily wants to invest in the stock market.She notices that the share price for Widgets Inc.has been falling for weeks.She chooses to invest in Widgets Inc.because she assumes it is due for a rebound.Lily suffers from

Question

Quizplus · Accepted Answer

The gambler's fallacy is the incorrect belief that if something happens more frequently than normal during a given period, it will happen less frequently in the future, or vice versa. In this case, Lily assumes that because the stock has been falling, it is due to rebound, which is a classic example of the gambler's fallacy.

Lily Wants to Invest in the Stock Market