11. Decision Making Flashcards

1
Q

What does the rationality of a decision describe

A

how well you select ways of thinking/actions that best serves your goals in the limitations of an environment

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2
Q

What is cognitive overload

A

When the information available overwhelms the cognitive processing available

leads to less optimal decisions

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3
Q

According to Galotti, what are the five types of tasks involved with decision making

A
  1. set or revise goals
  2. make plans
  3. gather information
  4. structure the final decision
  5. make a final selection
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4
Q

What is decision structuring

A

the way of organizing information so that we are able to make a decision

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5
Q

what are subjective probabilities vs objective probabilities

A

subjective probabilities: influenced by the characteristics of the probability estimator (etc. your success depending on mood)

objective probabilities: not infuenced

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6
Q

what is a bias

A

a way of thinking that leads to systematic errors

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7
Q

what are cognitive illusions

A

systematic biases for thinking

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8
Q

What is the availability heuristic

A

Deeming that the things that comes to mind more easily are more frequent

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9
Q

What is the representativeness heuristic

A

The expectation that the results will be representative of the process that generated them

etc. coin flips

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10
Q

What is the mistaken belief in the law of small numbers

A

People mistakenly believe that small samples will resemble the populations from which they are drawn

etc. coin flips, people

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11
Q

A “Man who” arguments are a misuse of which heuristic
“I know a man who….”

A

representativeness heuristic

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12
Q

What are framing effects?

A

When we evaluate changes from a reference point

  • problem: changing the description of a situation can make us adopt different reference points

think $$ of a sale

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13
Q

What is Anchoring?

A

When the initial starting point has a huge effect on the final estimate

etc. calculating 1x2x3… 8 vs 8x7x….1

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14
Q

What is Illusory correlation?

A

When we see nonexistant relationships

etc. hair twisting, finding personality vs. handwriting

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15
Q

What is the Hindsight Bias

A

Looking back, events seem inevitable

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16
Q

What kind of curve plots confidence against accuracy

A

a calibration curve

17
Q

What does it mean for the calibration curve to deviate below the 45deg line

A

overconfidence

18
Q

Explain normative vs prescriptive vs descriptive models of decision making

A

normative: ideal performance in ideal circumstances

prescriptive: what we “ought” to behave, given that circumstances are not ideal
- prescribe

descriptive model: what do people actually do

19
Q

What kind of model is expected utility theory

A

normative

20
Q

What is expected utility theory

A

maximizing the expected utility

21
Q

What kind of model is image theory

A

descriptive model

22
Q

What is the image theory model

A

we narrow all of our decision to a few, by comparing the
1. value image: our values and morals
2. trajectory image: our goals for the future
3. strategic image: how we want to attain the goal

23
Q

What kind of decisions do experts make

A

recognition-primed decision making

24
Q

What is recognition primed decision making

A

comparing the situation to previous experiences

25
Q

what is neuroeconomics

A

study of how the brain interacts with the environment to make complex decisions + the role of emotions in this process

26
Q

T/F Decision making can be highly emotional

A

T

Phineas Gage; impaired both decision making and emotional control

27
Q

What active brain regions positively predicted purchasing regions

A

PFC

28
Q

What active brain region negatively predicted purchasing decisions

A

insula

  • insulate
29
Q

What are humans good at when it comes to decision making and what are they bad at?

A

they are good at figuring out which variables are good predictors

they are bad at integrating information to a decision