Lecture 20: Decision Making I

Question 1

Decision Making Traps:

Answer 1

• Failing to consider every alternative
• Not considering every possible outcome
• Unrealistic expectations about consequences (‘wishful thinking’)

Question 2

Do you feel it is worse to be:

Answer 2

• Unsympathetic or unreasonable?

- MBTI (Myer Briggs…)

Question 3

The mental processes used to simplify the task of responding to uncertainty are known as…..examples of this include:

Answer 3

• Heuristics
• Availability
• Anchoring and Adjustment
• Representativeness

Question 4

Heuristics are generally…..but can lead to ____ _____.

Answer 4

• Right / Valid / True

- Predictable Errors

Question 5

Two psychologists have won the Nobel Peace Prize, these include Simon and Kahneman for…

Answer 5

• Simon = satisficing, satisfying + sufficing (shipping example)
• Kahneman = looking at behaviour under uncertainty

Question 6

The availability heuristic is…

Answer 6

• The perceived likelihood of an event or outcome is based on the ease with which relevant instances can be brought to mind

Question 7

Decision making experiments:

Answer 7

• Who does what?
• Shopping, cleaning, cooking
• Most overestimated contributions
• Recall more examples of own contributions than partner’s
• Recall of own examples and estimates of contribution correlated

Question 8

The anchoring and adjustment heuristic both have a…

Answer 8

• Natural starting point is used as a first approximation or anchor
• Anchor is adjusted according to additional information
• Adjustment is generally smaller than it should be

Question 9

The representativeness heuristic is used to judge…

Answer 9

• Likelihood by comparing resemblance or similarity
• ‘Linda’ seems more similar to the stereotype of an active feminist than a bank teller
• I see myself as an unlike a stereotype alcoholic and conclude the likelihood of becoming an alcoholic is low

Question 10

Representative thinking is pervasive in evaluating legal, political, social scenarios because…

Answer 10

• Adding details can increase representativeness whilst decreasing actual likelihood e.g.

Question 11

Decision making deals with ______ and is subject to a number of ______ and difficulties.

Answer 11

• Uncertainty

- Traps

Question 12

Gigerenzer explores how….this is called:

Answer 12

• Simple heuristic processes enable us to make smart choices quickly and with minimal information
• ‘Fast and Frugal Decision Making’