COMMERCE 1BA3 Lecture Notes - Lecture 11: Crowdsourcing, Norm (Social), Prospect Theory

• School: McMaster University
• Department: Commerce
• Course: COMMERCE 1BA3
• Professor: Mosey Nicholas J

Document Summary

Decision-making is the process of developing a commitment to a chosen course of action. Decision-making can also be described as a process of problem solving. Existing state is clear, the desired state is clear, and how to get from one state to another is fairly obvious. Repetitive and familiar: can be programmed. A program is a standardized way of solving a problem. Programs enable the decision maker to go directly from problem identification to solution. They are also known as rules, routines, standard operating procedures, or rules of thumb. They provide efficient means of solving well-structured problems. Existing and desired states are unclear and the method of getting to the desired state is unknown. Unique and unusual problems that have not been encountered before. Tend to be complex and involve a high degree of uncertainty. A rational decision maker might use a model that involves a sequence of steps that are followed when making a decision.