In 2008, the sales of the Trident Inc. went up by 10% and its stock prices increased by 20%. In 2010, the sales of the Trident Inc. went up by 15% and its stock prices increased by 30%. You conclude that in 2013, since the sales increased by 5%, the stock price will increase by 10%. Which type of reasoning are you using?
A. deductive reasoning
B. intuitive reasoning
C. suggestive reasoning
D. inductive reasoning
Answer:D
In 2008, the sales of the Trident Inc. went up by 10% and its stock prices increased by 20%. In 2010, the sales of the Trident Inc. went up by 15% and its stock prices increased by 30%. You conclude that in 2013, since the sales increased by 5%, the stock price will increase by 10%. Which type of reasoning are you using?
A. deductive reasoning B. intuitive reasoning C. suggestive reasoning D. inductive reasoning
Explanation: D) Inductive reasoning draws conclusions from patterns. The inductive reasoning process flows from a set of specific observations, facts, or data to a working hypothesis and then a general conclusion (that is, bottom up). Here, the pattern in increase in sale along with corresponding increase in stock prices is forming the base for conclusion.