Low Effort Decisions (Test 2)

Question 1

What is the Availability Heuristic?

Answer 1

Making decisions about probability based on what comes to mind easily

Question 2

What is the Representative Heuristic?

Answer 2

If you think something is true, then it is true

Example: Before & Afters

Question 3

What is Base Rate Neglect?

Answer 3

When irrelevant info is used to make a probability judgement

Example: Asking the waiter what they like on the menu instead of what’s the most popular item?

Question 4

What is a Sunk Cost?

Answer 4

Costs that have already been incurred and cannot be recovered

Question 5

What is the Halo Effect?

Answer 5

The tendency to assume that if something is good on one attribute, then it is good on all others

(Example: If someone is good at “X”, then they are good at “Y”) Even if the two aren’t related

Question 6

What is Confirmation Bias?

Answer 6

The tendency to see what we expect to see. People interpret info that supports (or confirms) their prior expectations

(Example: Unhealthy = Tasty Intuition)

Question 7

What is Self Positivity Bias?

Answer 7

When you think bad things happen to other people, but not to us

(Example: Why people smoke, drive drunk and speed)

Question 8

What is Outgroup Homogenity?

Answer 8

When you feel people in the outgroup are more like each other than they actually are

(Example: Assuming everyone from USD is rich, spoiled and smarter)

Question 9

What is the Egocentric Bias?

Answer 9

People are more like you than they actually are

Question 10

What do people think of Shelf Space at a store? (Marketing Based Heuristics)

Answer 10

Seeing brands with more shelf space might make people think its more popular

Question 11

What do people think when there is scarcity of a product? (Marketing Based Heuristics)

Answer 11

Might see the product as desirable

Example: Popeye’s chicken sandwich

Question 12

What is the number of arguments heuristic? (Marketing Based Heuristics)

Answer 12

The longer the list of arguments, the greater the strength of the overall argument

Question 13

What is the Price-Quality Heuristic? (Marketing Based Heuristics)

Answer 13

Higher Price = Higher Quality

Question 14

What is the the Family Influence Effect?

Answer 14

The tendency to buy the same products our parents buy or do the same things they do

(Example: The way you cut bacon)

Question 15

What is the Fundamental Attribution Error?

Answer 15

You overattribute others’ actions to their personality and underattribute to the situation

If you behave badly, you attribute it to the situation, not anything about you

Example: Thinking someone is bad at driving for cutting you off

Question 16

What is the Performance Related Tactics?

Answer 16

Basing performance on quality of the product

Question 17

What is Price-related tactics?

Answer 17

Basing price on quality of products

Question 18

What is Brand Loyalty?

Answer 18

Buying the same brand repeatedly because of a strong preference

Question 19

What is Status Quo Bias?

Answer 19

The Tendency to do nothing or maintain the situation, if that is an option (Not due to loyalty)

(Example: Ordering the same toppings on pizza)

Question 20

What is Normative Influences?

Answer 20

When other individuals influence our choices

Question 21

What is Direct Influence? (Normative Influences)

Answer 21

Others try to manipulate us

Question 22

What is Vicarious Observation? (Normative Influences)

Answer 22

Watch what others do to guide our behavior

Question 23

What is Indirect Influence? (Normative Influences)

Answer 23

When we are concerned about the opinions of others

Question 24

What is the “How do I feel about it?” Heuristic?

Answer 24

When you use your emotions to influence your decision

Question 25

What is Choice Overload?

Answer 25

When there are too many choices, so we become frustrated when choosing

Question 26

What is the Gambler’s Fallacy?

Answer 26

When you make a prediction on a random thing based on what happened

“Let me do one more game to win it back

Question 27

What is the Hot Hand Fallacy?

Answer 27

People on streaks think they can do it all the time

Example: Someone who makes 4 free throws thinks they can make every free throw

Question 28

What is the Illusion of Control?

Answer 28

The tendency for human beings to believe they can control or at least influence outcomes which they clearly cannot control

(Example: Blowing on dice when gambling)

Question 29

What is Willful Ignorance?

Answer 29

The tendency to avoid info that, while useful and important, could cause emotional unease (Even when info would be used to make an informed decision, if it were provided)

(Example: Climate Change data)