Maxims for Thinking Analytically

Question 1

Maxim 8

Answer 1

Good decisions sometimes have poor outcomes.

Question 2

Maxim 19

Answer 2

Make pleasure-enhancing decisions long in advance, to increase the utility of anticipation.

Question 3

Maxim 9

Answer 3

Some good decisions have a high probability of a bad outcome.

Question 4

Maxim 13

Answer 4

Long division is the most important tool for policy analysis.

Question 5

Maxim 2

Answer 5

When you are having trouble getting your thinking straight, go to a simple case.

Question 6

Maxim 18

Answer 6

Do your best to banish regret.

Question 7

Maxim 6

Answer 7

Think probabilistically about the world.

Question 8

Maxim 4

Answer 8

When trying to understand a complex, real-world situation, think of an everyday analogue.

Question 9

Maxim 14

Answer 9

Elasticities are a powerful tool for understanding many important things in life.

Question 10

Maxim 15

Answer 10

Heterogeneity in the population explains many phenomena.

Question 11

Maxim 1

Answer 11

When you are having trouble getting your thinking straight, go to an extreme case.

Question 12

Maxim 12

Answer 12

Information is only valuable if it can change your decision.

Question 13

Maxim 11

Answer 13

Don’t be limited by the options you have in front of you.

Question 14

Maxim 5

Answer 14

The world is much more uncertain than you think.

Question 15

Maxim 3

Answer 15

Don’t take refuge in complexity.

Question 16

Maxim 10

Answer 16

Errors of commission should be weighted the same as errors of omission.

Question 17

Maxim 17

Answer 17

Strive hard to avoid envy - see your friend’s success as your gain.

Question 18

Maxim 16

Answer 18

Capitalize on complementarities.

Question 19

Maxim 7

Answer 19

Uncertainty is the friend of the status quo.