#1
In decision making, what does the term 'satisficing' refer to?
Choosing the first option that meets the minimum criteria
ExplanationAccepting a satisfactory or 'good enough' solution rather than seeking the optimal one.
#2
Which part of the brain is primarily associated with emotional decision making?
Amygdala
ExplanationAn almond-shaped structure in the brain responsible for processing emotions, especially fear and pleasure.
#3
What is the term used to describe the tendency to rely too heavily on the first piece of information encountered when making decisions?
Anchoring bias
ExplanationThe cognitive bias where individuals rely heavily on the first piece of information encountered (the 'anchor') when making decisions, even if it's irrelevant.
#4
Which of the following is a characteristic of intuitive decision making?
It is based on unconscious judgments and gut feelings.
ExplanationDecision making that relies on unconscious processes, often based on instincts, emotions, or 'gut feelings' rather than conscious reasoning.
#5
Which of the following best describes the concept of risk aversion?
Preferring certainty over uncertainty even if it means sacrificing potential gains.
ExplanationThe tendency to avoid or minimize risks, preferring certainty even if it means sacrificing potential gains.
#6
What is the primary objective of decision analysis?
To identify the most suitable alternative by considering various criteria.
ExplanationA systematic approach to decision making that involves evaluating alternatives to identify the most suitable option based on predefined criteria.
#7
Which of the following is an example of a heuristic in decision making?
Representativeness heuristic
ExplanationA mental shortcut that involves judging the likelihood of an event based on how similar it is to a prototype.
#8
What is the term used to describe the cognitive bias where individuals overestimate their ability to predict future events?
Overconfidence bias
ExplanationThe tendency to have excessive confidence in one's own judgments or abilities, often leading to overestimation.
#9
What is the main difference between deductive and inductive reasoning?
Deductive reasoning starts with specific premises to reach a general conclusion, while inductive reasoning starts with observations to form a general principle.
ExplanationDeductive reasoning moves from general principles to specific conclusions, while inductive reasoning moves from specific observations to general principles.
#10
Which of the following is an example of bounded rationality in decision making?
Using shortcuts or simplified decision-making strategies
ExplanationThe concept that decision makers have limited cognitive resources and must simplify complex problems by using heuristics or other shortcuts.
#11
What is the term used to describe the tendency to seek out information that confirms one's pre-existing beliefs or hypotheses?
Confirmation bias
ExplanationThe tendency to search for, interpret, or recall information in a way that confirms one's preconceptions or hypotheses while disregarding contradictory evidence.
#12
What is the role of emotions in decision making?
Emotions can influence decision making by providing valuable insights.
ExplanationEmotions play a significant role in decision making, providing valuable information and influencing choices by signaling what is important or threatening.
#13
According to prospect theory, which of the following statements is true?
People tend to avoid risks when faced with gains and seek risks when faced with losses.
ExplanationA psychological theory that suggests individuals weigh potential losses and gains differently, often favoring certainty over uncertainty.