🧪Chapter Read Along Q&A Judgment and Decision Making

According to the ______rationality framework, human beings try to make rational decisions, but our cognitive limitations prevent us from being fully rational.

bounded

Jason is the coach of his son’s team and must select 3 players to send to the all-star game. He chooses his son as one of the players to send. According to the ______framework, Jason’s attempt to think objectively is restricted by a cognitive limitation--in this case a bias toward his own son.

bounded rationality

People’s judgments about various situations are predictably affected by ______, or mistakes that influence how we evaluate those circumstances.

biases

Which pair of researchers, following in the footsteps of Herbert Simon, conducted research on the existence of cognitive biases that eventually won them the Nobel Prize?

Tversky and Kahneman

You are trying to decide what type of vehicle to buy. A bicycle is eco-friendly, an electric car is expensive and a van is the most suitable for your family. According to Bazerman and Moore (2013), the first step you will take to make a rational decision will be to:

define the problem.

Which researcher(s) identified a six-step model of rational decision-making in 2013?

Bazerman and Moore

Which of the following refers to a strategy that is used to simplify decision-making, sometimes at the cost of logic and rationality?

a heuristic

Marissa believes that even 30 years after graduation she will be able to name 250 of the 300 students in her graduating class. Later, she is only able to correctly identify 75. This reflects her ______in her own skill.

overconfidence

Brenda sees a television advertised around $500. When she finally buys one for $450, she feels she got a good deal. In this case, the $500 price acted as a(n) ______.

anchor

A letter from a charity requests a donation. It asks if you would donate $100, $50, $25 or some other amount. The first, larger numbers provides a(n) ______from which you will adjust your donation.

anchor

Smoking Brand A carries an 80% chance of developing lung cancer while smoking Brand B carries a 20% chance of not developing lung cancer. Even though the outcomes are the same, the ______can affect the decisions that people make.

framing

A sales rep tells Jackie, “A warranty on your new car is $1,000, but that is cheaper than a $3,000 replacement of your transmission.” This salesman is ______the argument in a way that will convince Jackie to buy the warranty.

framing

According to Thaler (2000), decision-making is affected by the fact that ______is bounded; we give greater weight to present concerns than we do to future concerns.

willpower

Mitzi really wants to vacation this July and does not think at all about saving money for retirement. Mitzi’s failure to consider long-term effects demonstrates how ______is/are often bounded in decision-making.

willpower

Although Sheldon wants to go to a book reading, he opts to go to a play with his girlfriend. She would not be upset if she went to the play alone. Sheldon’s willingness to (unnecessarily) sacrifice for his girlfriend demonstrates that ______is bounded.

self-interest

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

Bounded awareness

Which of the following is NOT one of the components of the theory of bounded rationality that has been contributed to by different researchers over the past two decades?

Bounded attributions

Decision-making and judgment research has been applied to which of the following fields outside the area of psychology?

behavioral marketing

When trying to decide if she is going to accept the offer of a date from the new guy in class, Lena relies on her intuition. She accepts his offer quickly, based on her automatic, gut feeling about his qualities as a potential boyfriend. Lena has used System ______decision-making.

1

This kind of decision-making is slower, conscious, effortful, explicit, and logical.

System 2