Going directly to a car dealer for a loan to keep things simple is an example of which type of decision?

• A. Risk-averse investment
• B. Diversification strategy
• C. Convenience decision
• D. Optimal financial planning

Answer: (C)

Verified step by step guidance

1. Step 1: Begin by analyzing the context of the problem. The question is asking about a type of decision related to obtaining a car loan directly from a dealer.
2. Step 2: Understand the terms provided in the options. For example, 'Risk-averse investment' refers to minimizing risk in financial decisions, 'Diversification strategy' involves spreading investments to reduce risk, 'Convenience decision' focuses on simplicity and ease, and 'Optimal financial planning' involves making the best financial choices for long-term benefits.
3. Step 3: Evaluate the scenario described in the problem. Going directly to a car dealer for a loan is characterized by simplicity and ease, rather than a detailed financial analysis or risk management.
4. Step 4: Match the scenario to the most relevant term. The decision to go directly to a car dealer aligns with the concept of a 'Convenience decision' because it prioritizes simplicity over other financial considerations.
5. Step 5: Conclude that the correct answer is 'Convenience decision' based on the reasoning above, as it best describes the nature of the decision in the given context.