Certainty: Exists when a solid factual basis allows
prediction of a decision’s outcome
Risk: Exists when a decision is made on the basis of
incomplete but reliable information. Objective probabilities are based on
reliable data. Subjective probabilities are based on judgment.
Uncertainty: Exists when no reliable data exist on
which to base a decision.
The Relationship between Uncertainty
and Confidence
Information Processing Styles
Thinking Style: Being deliberative, logical,
precise, and objective when making a decision. Suited to routine tasks
requiring attention to detail and systematic implementation.
Intuitive Style: Being creative, following hunches
and visions in decision making. Best for rapidly changing situations requiring
creativity and intuition
How to Sharpen your Intuition
Avoiding Perceptual and Behavioral Decision Traps
Framing Error: The way in which information is
presented influences one’s interpretation of it, which, in turn, may alter a
decision based on the information.
Escalation of Commitment:
Continuing on a course of action can lock a person into a losing position
(“throwing good money after bad”).
Overconfidence: Believing too much in one’s own
capabilities is a trap.
Why Escalation of Commitment Is So
Common
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