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Fundamental Attribution Error

Categories: Accounting, Metrics

When people look at others and misjudge why they do what they do.

They’ll assume that a front door greeter is grouchy because…well…the person is just mean-natured, when in reality it could be because the person’s pet just died, and his/her romantic relationship ended three days later. The person is grouchy because he/she is getting smacked around by life.

On the flip side, they might assume the other front door greeter got promoted to regional manager because he or she brown noses a lot and has a lot of charisma, when in reality it’s because the person’s uncle is in the state legislature and it’s a political favor.

Find other enlightening terms in Shmoop Finance Genius Bar(f)