Psych 2H03: Human Learning and Cognition
Chapter 13: Decision Making
Subjective utility: the personal evaluation of a decision outcome.
Unconscious thought theory (UTT): described in 3 principles: unconscious
thought requires little cognitive capacity; it tends to be guided by expectations and
schemas; and it weighs the relative importance of various attributes in an unbiased
Heuristics: a shortcut or rule of thumb that often, but not always, helps to solve a
Algorithm: a clearly defined set of procedures that, if given enough time, will
always solve a problem.
Representativeness: the likelihood of an event, judging by how similar it is to
another event of known probability.
Base rate: a known proportion of a sample or population.
Availability: a heuristic that uses the ease by which facts are retrieved as an
indicator of how important they are or how frequently they occur.
Anchoring and adjustment: using initial information as a starting point and then
adapting from it to make judgments about other measurements; this prevents the
problem solver from deviating from the initial information, even in the face of
Somatic marker hypothesis: the theory that the entire body’s emotion-related
circuitry is the basic system in which decision making occurs.
Decision fallacy: the false belief that two events, which are independent of each
other, are casually related.
Sunk cost: invested money or resources that cannot be recovered.
Sunk cost fallacy: committing additional money or resources into an unprofitable
activity because one has already invested in it; additional resources increase the
cost of the investment but not the likelihood of a positive outcome.
Gambler’s fallacy: the mistaken belief that independent past eve