Chapter 12 Flashcards
What is deductive reasoning?
Going from general to specific. Ex: all college students like pizza, Kelsie is a college student, therefore Kelsie likes pizza.
What is inductive reasoning?
Going from specific to general (ex: Kelsie is a college student. Kelsie lives in a dorm. Therefore, all college students live in a dorm)
Differences between inductive and deductive reasoning
Deductive is promised a true conclusion is true premises is used. If a true premises is used in inductive, it does not guarantee a true conclusion.
What is wason selection test?
4 cards, told reverse side of an even number is always red, which card should you draw? To get the right answer you need to use deductive reasoning
What are cognitive illusions?
systematic biases that can lead to error when misapplied
What are heuristics
Shortcuts or biases. Availability, representativeness, gamblers fallacy, base rate neglect, conjunction fallacy, framing, risk aversion, anchoring, sunk cost, illusory correlation, hindsight bias, confirmation bias, overconfidence
Availability h what is availability bias
More instances come easily to mind- greater probability. Consider letter L, is L more likely to appear in the first letter of a word or in the third letter? Response: first, answer: third
Representativeness heuristic
An event is judged to be more likely if it appears to be representative of underlying process. Coin toss: is heads of tails more probable? Roulette wheel: which will be the 9th trial?
What is gamblers fallacy?
Mistaken belief that a small sample will reflect what is expected on average
What is base rate neglect
Ignore related based information and focus on specific information
What is conjunction fallacy
Two conjunctive statements are more probable than just one of the statements
What framing effects
A persons frame of mind can influence their decision.
Ex: station a sells gas at $3 per gallon whil station b sells gas for $2.95
Station a announces 5 cent discount for cash, station b announces 5 cent surcharge for credit card.
People prefer a to b but both charge $2.95 for cash and $3 for credit cards
-discounts sounds better than a surcharge!
What is risk aversion?
We treat losses more seriously than gains in the same amount
What are anchoring effects?
The starting number (anchor) has influence in providing approximate numbers.
Ex
87654321=12345678
Responses- 2250 vs 512
Answer: 40,320
What are sunk cost effects?
Tendency to stick with a losing strategy once an investment in money, effort, or time has been made.
