[Week 8] Judgment and Decision Making

Question 1

Anchoring

Answer 1

The bias to be affected by an initial anchor, even if the anchor is arbitrary, and to insufficiently adjust our judgments away from that anchor.

Question 2

Biases

Answer 2

The systematic and predictable mistakes that influence the judgment of even very talented human beings.

Question 3

Bounded awareness

Answer 3

The systematic ways in which we fail to notice obvious and important information that is available to us.

Question 4

Bounded ethicality

Answer 4

The systematic ways in which our ethics are limited in ways we are not even aware of ourselves.

Question 5

Bounded rationality

Answer 5

Model of human behavior that suggests that humans try to make rational decisions but are bounded due to cognitive limitations.

Question 6

Bounded self-interest

Answer 6

The systematic and predictable ways in which we care about the outcomes of others.

Question 7

Bounded willpower

Answer 7

The tendency to place greater weight on present concerns rather than future concerns.

Question 8

Framing

Answer 8

The bias to be systematically affected by the way in which information is presented, while holding the objective information constant.

Question 9

Heuristics

Answer 9

cognitive (or thinking) strategies that simplify decision making by using mental short-cuts

Question 10

Overconfident

Answer 10

The bias to have greater confidence in your judgment than is warranted based on a rational assessment.

Question 11

System 1

Answer 11

Our intuitive decision-making system, which is typically fast, automatic, effortless, implicit, and emotional.

Question 12

System 2

Answer 12

Our more deliberative decision-making system, which is slower, conscious, effortful, explicit, and logical.