Chapter 11: Making Decisions

Question 1

Rationality

Answer 1

Rational decision making has to do with selecting ways of thinking and acting to serve your goals or moral imperatives, as well as the environment permits

Question 2

Cognitive Overload

Answer 2

When available info overwhelms the cognitive processing available

Question 3

Phases of Decision Making

Answer 3

Setting/revising goals
Make plans
Gather info
Structure the decision
Make a final selection

Question 4

Setting Goals

Answer 4

Decision maker takes stock of their future plans, principles and values, or priorities
Those answers influence decision making

Question 5

Gathering Info

Answer 5

Need information before making a decision
Need to understand various options
Short and long term consequences
Who is affected in each option
Do effects change over time

Question 6

Structuring the Decision

Answer 6

Decision structuring: the way a decision maker manages information and considerations for a decision
Need a way of organizing info for complex decisions
Especially when there are many options or many considerations to be used in making the decision

Question 7

Making A Choice

Answer 7

Selecting from among the final set of options
Can involve objective choice (e.g. coin flip) or more complex process
May involve other decisions (e.g. when to stop gathering info, which info is more relevant)

Question 8

Evaluating

Answer 8

Evaluation of entire decision process
Often an omitted step
Reflect on process and identify aspects to be improved, and those who should be used again

Question 9

Probability

Answer 9

Measurement of a degree of uncertainty
Probabilities are numbers between 0 and 1
0 = complete certainty that an event will not happen
1 = complete certainty that an event will happen
People’s intuitions about probability are often wrong

Question 10

Subjective Probabilities

Answer 10

Influenced by characteristics of probability estimator
If in a bad mood, probability estimates of success tend to be lower

Question 11

Objective Probabilities

Answer 11

Not influenced by the person doing the estimation
Many real life circumstances are not objective

Question 12

Biases

Answer 12

Ways of thinking that lead to systematic errors
Biases are usually understandable and often justifiable ways of thinking but can lead to error when misapplied

Question 13

Cognitive Illusions