Question 1

Coming up with an answer that is "good enough" is called (a)_____________.

Accepted Answer

The term "satisficing" refers to the tendency to settle for a solution that is good enough rather than seeking the best possible solution. This concept was first introduced by Herbert Simon in 1956 as a way to describe the limitations of human decision-making in complex environments. Bounded rationality (choice C) refers to the idea that humans have limited cognitive abilities and cannot always make fully rational decisions, while a suitable solution (choice A) and adequacy (choice B) do not capture the idea of settling for a less-than-perfect solution.

Question 2

The expected value or worth of an outcome at the time of decision is referred to as the ______________.

Accepted Answer

The answer of The expected value or worth of an...

Question 3

Neurons in the _________________ of the monkey brain are active when tracking the probability and magnitude of a reward.

Accepted Answer

The lateral inferior parietal cortex is active when tracking the probability and magnitude of a reward.

Question 4

The _________________ is an area of the brain active when shifting attention in anticipation of a reward.

Accepted Answer

The answer of The _________________ is an area of the...

Question 5

________________ proposed the idea of bounded rationality.

Accepted Answer

Herbert Simon, a Nobel Prize-winning economist, proposed the idea of bounded rationality, which suggests that decision-making is limited by an individual's cognitive abilities, time constraints, and the availability of information.

Question 6

If you conduct a single-cell recording study examining the activity associated with rewarded events when those events are rewarded,you are examining _________________.

Accepted Answer

Single-cell recording studies measure the activity of individual neurons in response to specific stimuli or events. In this case, the study is examining the activity associated with rewarded events when those events are rewarded. This is an example of experienced utility, which refers to the actual pleasure or satisfaction a person experiences from a given activity or outcome. Expected utility, on the other hand, refers to the anticipated pleasure or satisfaction a person expects to receive from a given activity or outcome. Decision utility refers to the usefulness or benefit of a decision, while marginal utility refers to the additional satisfaction or benefit gained from consuming or obtaining one additional unit of a particular good or service.

Question 7

Sam buys an autographed picture of his favorite football player for $300 on eBay.Upon showing it off,he is offered $350 for it.Sam indicates that he could not possibly sell for less than $450.This is an example of _______________.

Accepted Answer

This is an example of the endowment effect, which refers to the tendency for individuals to overvalue items they own or possess. Sam values the autographed picture at $450 simply because he now owns it, even though he only paid $300 for it. This bias can make it difficult for people to make rational decisions about selling or trading items.

Question 8

Our ability to think rationally about information within our cognitive limitations is known as ________________.

Accepted Answer

Bounded rationality refers to the idea that our ability to make rational decisions and judgments is limited by factors such as time, information overload, and our cognitive abilities. It acknowledges that our decision-making processes are not always completely rational or optimal, but rather are based on heuristics and shortcuts that help us make decisions quickly and efficiently within our cognitive constraints. Choices A, B, and C all refer to specific cognitive processes that contribute to our overall ability to make decisions, but bounded rationality encompasses all of these processes and more.

Question 9

After an exam,you find out that you had a higher grade than Sam and that Sam had a higher grade than Rebecca.You correctly assume that you have a higher grade than Rebecca.This is an example of ______________.

Accepted Answer

This is an example of transitivity as the relation "having a higher grade than" satisfies the transitive property. If A has a higher grade than B and B has a higher grade than C, then it can be concluded that A has a higher grade than C.

Question 10

In assessing deaths by mode of transportation,people will show a tendency to ___________ the chance of dying in a plane crash and _________ the chance of dying in a car accident.

Accepted Answer

People tend to overestimate the chance of dying in a plane crash because of the high-profile media coverage of such incidents, even though the actual risk is very low. On the other hand, they tend to underestimate the chance of dying in a car accident because it is a common mode of transportation and the risk is normalized.

Question 11

Our capacities for __________,__________,and ___________ limit our ability to think rationally.

Accepted Answer

Attention and working memory are crucial for processing and organizing information, while executive control plays a role in decision-making and inhibiting impulsive behavior. Emotion and perception can also influence our thinking, but they are not as directly related to rationality as attention, memory, and executive control. Therefore, C is the best choice as it includes all three key factors.

Question 12

Utility curves are helpful for relating ____________ to ____________.

Accepted Answer

Utility curves are tools used in economics and decision theory to relate subjective evaluation (how individuals value outcomes based on personal preferences) to an objective measure (such as monetary value). These curves help in understanding how individuals make choices based on their personal valuation of different outcomes.

Question 13

People prefer __________ when it comes to gains and ___________ when it comes to losses.

Accepted Answer

People generally prefer certainty when it comes to gains to ensure they receive a guaranteed benefit, and they prefer uncertainty when it comes to losses in hopes of avoiding or minimizing the loss.

Question 14

Suppose you just lost $500 playing poker.To compensate for this loss,research suggests that you would want to win at least _______________.

Accepted Answer

Research in psychology, particularly in the field of loss aversion, suggests that losses feel more significant than gains of the same amount. To compensate for a loss, individuals often desire a gain that is roughly twice the amount of the loss, making $1000 the amount needed to compensate for a $500 loss.

Question 15

"Would you pay $3.75 for a gallon of gas?" and "How much would you be willing to pay for a gallon of gas?" are two ways of asking the same question about preferences.This is an example of ______________.

Accepted Answer

These questions illustrate procedural invariance, which refers to the principle that preferences should not change based on the way choices or questions are presented or framed.

Question 16

___________ involves simplifying and combing some quantities and evaluation gains and losses in relation to a reference point.

Accepted Answer

The description refers to the concept of framing, which involves changing how information is presented to influence the interpretation and decision-making of the audience. This can involve simplifying or combining quantities, as well as highlighting gains or losses relative to a reference point. Anchoring is a related concept involving the use of an initial value or reference point to anchor subsequent evaluations or decisions. Reduction theory and comparative processing are not directly related to this description.

Question 17

Satisficing is a(n)_____________.

Accepted Answer

The answer of Satisficing is a(n)_____________.
...

Question 18

Research with monkeys and humans has found that the ____________ system in involved with the encoding of utility values in the brain.

Accepted Answer

Dopamine is known to be involved in reward processing and is associated with the encoding of utility values in the brain. Both monkey and human studies have shown that dopamine neurons encode both positive and negative values related to reward and punishment, respectively. Therefore, dopamine is the best choice among the given options.

Question 19

Statements like "What are the odds of that ever happening" are consistent with ____________.

Accepted Answer

The statement "What are the odds of that ever happening?" suggests a focus on the probability or likelihood of a future event occurring. This is consistent with temporal discounting, which refers to the tendency to value immediate rewards or costs more than delayed ones based on their perceived probabilities.

Question 20

Herbert Simon proposed the idea of _____________.

Accepted Answer

Herbert Simon proposed the concept of bounded rationality, which is the idea that individuals have limited cognitive abilities and must make decisions based on incomplete information, resulting in suboptimal but satisfactory decisions.

Quiz 9: Decision Making

Coming up with an answer that is "good enough" is called (a) _____________.