5. introduction

Question 1

the checker-shadow illusion

Answer 1

explained —> our brain makes the assumption that shade B must be lighter The checker-shadow illusion (

Question 2

Rational model of decision making

Answer 2

model hoe je decisiosn maakt

Question 3

Influencing factors on consumer decisions
4

Answer 3

situational factors = are related to the characteristics of buying task and the market offerings
personal factors = are individual characteristics and traits such as age, life stage, economic situation and personality
psychological factors = relate to the consumer’s motivation, learning, socialization, attitudes and beliefs
social factors = pertain to the influence of culture, social class, family, and reference groups

Question 4

System 1 processes involve:

Answer 4

automatic thought processes (fast)
basic intuition —> automatic behavior
most of these decision require little cognitive effort because we are skilled

Question 5

System 2 process:

Answer 5

is slower and more deliberative
is analytical and needs computation
exerts control over behavior
requires time and effort

Question 6

judgement =

Answer 6

ognitive aspects of the decision-making process

Question 7

bounded rationality = rationality of individuals is limited by
3

Answer 7

the information they have
the cognitive limitations of their minds
the finite amount of time they have to make a decision

Question 8

heuristics =

Answer 8

mental shortcuts to help people make a quick and satisfactory decision

Question 9

people learn from experience and develop many different heuristics over time
but sometimes, they might lead to

Answer 9

systematic erros

Question 10

The representativeness heuristic
example

Answer 10

Steve is short, slim and like to read. Do you think Steve is a teacher or truck driver?

Question 11

Conjunction fallacy

Answer 11

the conjunction or co-occurence of two events cannot be more likely than the probability of either event alone,

Question 12

The availability heuristic

Answer 12

ease with which the instances can be ‘brought to mind’

Question 13

easier to recall:
2

Answer 13

frequent actions
more familiar actions

Question 14

the problem is that certain events tend to stand out in our minds more than others, due to:
3

Answer 14

excessive media coverage
novelty
drama (failed vs. successful sky dives)

Question 15

biases from availability heuristics:
2

Answer 15

bias 1: ease of recall (based on vividness and recency)
bias 2: retrievability (based on memory structures)

Question 16

study 3 - Tversky and Kahneman (1973) - task: consider the letter (K,L,N,R,V) is it more common to appear in the first position or third position, estimate the ratio of the frequency for each resullt

Answer 16

result: 105 out of 152 people judged the first position to be more likely for a majority of the letters. Median estimated ratio = 2:1, fact: all these letters are more frequent in the third position @

Question 17

In marketing practice
representativeness heuristic, against a prototype:
2

Answer 17

how to use? similar packaging to established/premium brands > perceived quality
how to overcome? > Lenovo

Question 18

availability heuristic,how to use and how to overcome?
2

Answer 18

how to use? imagine product use, word of mouth, social media posts
how to overcome? provide base rate information

Question 19

Bandwagon effect
+ example

Answer 19

the tendency to do (or believe) things because many other people do (or believe) the same
a great example of this bias is fashion: many people being wearing a certain style of clothing as they see others adopt the same fashions

Question 20

trace of others behaviors:

Answer 20

higher preference for scarce products due to excess demand

Question 21

Scarcity effect + example

Answer 21

a phenomenon associated with an increase in value of goods when they are scarce (vs. abundant)
the effects of scarcity: increases desire (2 vs. 10 cookies in a jar, 2 rated more favorable), perceived as having higher value, polarizes preference —> the product that you like is scarce becomes even more liked and desired

Question 22

why is scarcity so powerful? scarcity as heuristic cue: 3

Answer 22

objects of higher value typically harder to obtain
loss aversion —> FOMO
mostly effective under conditions of mindlessness

Question 23

why is scarcity so powerful? systematic processing

Answer 23

commodity theory: proposing that the value of a product or service is related to its availability
enhances thinking about positive aspects
more extensive processing

Question 24

Endowment effect + theory

Answer 24

the tendency for people to demand much more to give up an object that they already have than they would be willing to pay to acquire it
mug experimetn: how much will you pay for mug how much will you sell mug

Question 25

The ‘I made it myself’ effect

Answer 25

the tendency for people to place a disproportionately high value on objects that they partially assembled themselves, regardless of the quality of the end product

Question 26

Biases and their self-serving purpose
and why?

Answer 26

self-serving: sometimes even when we try to be objective, our desires still might have an effect on how we form judgements
why? protecting our self-esteem, confidence, our ego

Question 27

blind spot bias

Answer 27

when we see others more biased than ourselves

Question 28

Framing

Context effect:

Answer 28

our preferences are not stable

Question 29

prospect theory by Kahneman and Tversky and how to use this in marketin g

Answer 29

behavioral model that shows how people decide between alternatives that involve risk and uncertainty (e.g. % likelihood of gains or losses)
it shows that people are loss averse —> loss is more powerful as a pleasure of gain