Perception and Decision making II

Question 1

Decision making model

Answer 1

1. A problem is identified
2. search for criteria and options
3. A limited list of the clear choices identified
4. reviews list, solution that is good enough

Question 2

Intuition

Answer 2

outside conscious thought

Question 3

Availability bias

Answer 3

base judgements on information that is readily available

Question 4

Overconfidence bias

Answer 4

intellectual and interpersonal abilities are weakest are most likely to overestimate their performance and ability

Question 5

Anchoring bias

Answer 5

fixing on initial information as a strong point and failing to adequately adjust for subsequent information

Question 6

Escalation of commitment

Answer 6

staying with a decision even when there is clear evidence it is wrong

Question 7

Randomness ERROR

Answer 7

believe we can predict outcome of random events

(Illusion of control)

Question 8

Risk aversion

Answer 8

prefer a sure thing instead of a risky outcome

Question 9

Hindsight bias

Answer 9

believe falsely that one has accurately predicted the outcome of an event, after that outcome is actually known

Question 10

How to avoid biases and error ?

Answer 10

• focus on goals
• look for information that disconfirms your beliefs
• dont try to create meaning out of random events
• increase your options

Question 11

What effects our decisions ?

Answer 11

Personality
Cultural differences
mental ability
gender

Question 12

Utilitarianism

Answer 12

decision are made solely on basis of their outcomes or consequences

Question 13

Behavioral ethics

Answer 13

analyzes how people behave when confronted with ethical dilemmas

Question 14

Lying

Answer 14

undermines all efforts to make the right decision

Question 15

Creativity

Answer 15

ability to produce novel and useful ideas

1. problem formulation
2. information gathering
3. idea generating
4. Idea evolution