The tendency of small firms to have higher returns than large firms , even after adjusting for risk, may be attributable to
A)representativeness.
B)overconfidence.
C)familiarity bias.
D)loss aversion.

Question

Quizplus · Accepted Answer

Small firms may be less familiar to investors, leading to a familiarity bias where investors prefer larger, more well-known firms, potentially resulting in higher returns for small firms as they are undervalued.

The Tendency of Small Firms to Have Higher Returns Than