1. Decision Making

2. Reasoning & Problem Solving A. Two Classes of Reasoning I. Deductive Reasoning II. Inductive Reasoning

3. I. Deductive Reasoning reasoning from the general to the specific Syllogisms All A are B (first premise). All B are C (second premise). thus All A are C (valid conclusion). ~~~~~~~~~~~~~~~~~~~~~~~~~~ All A are B. Some B are C. thus All A are C (invalid).

4. I. Deductive Reasoning Syllogisms All professors are absent minded; Bob is a professor, thus, Bob is absent minded (valid) ~~~~~~~~~~~~~~~~~~~~~~ Tomatoes taste salty. Tomatoes are red. All red foods taste salty (invalid).

5. II. Inductive Reasoning reasoning from specific to general if all the people you've ever met from a particular town have been very paranoid, you might then say "all the residents of this town are paranoid” essence of the experimental method involves formulating hypothesis

6. Confirmation Bias  Subjects focus on positive evidence  Hypothesis-driven behavior  Cognitive tunnel vision  Tend to ignore negative evidence (even though equally diagnostic) Inductive vs. Deductive Reasoning

7. Representativeness Heuristic tendency for event to be judged probable to the extent that it represents the essential features of parent population or generating process  Coin toss: Which is more representative? Heuristics Influencing Decision Making Kahneman & Tversky HTHTHTTHHT HHHHHTTTTT

8. Representativeness Heuristic Frank is a meek and quiet person whose only hobby is playing chess. He was near the top of his college class and majored in philosophy. Is Frank a librarian or a businessman?  consistent with librarian stereotype, but there are many more businessmen, so base rates make it much more likely that Frank is a businessman.

9. Representativeness Heuristic Judge probability of an event based on how it matches a prototype Can be accurate Can also lead to errors Most will overuse representativeness i.e. Frank’s description fits our vision of a librarian

10. Jake is a 45 year old man. He is married and has four children. He is generally conservative, careful, and ambitious. He shows no interest in political and social issues and spends most of his time on his hobbies that include carpentry, sailing and mathematical puzzles What’s the likelihood that Jake is an engineer? I. Representativeness Heuristic

11. A certain town is served by two hospitals. In the larger hospital about 45 babies are born each day, and in the smaller hospital, about 15 babies are born each day. Traditionally, 50% of all babies are boys and 50% girls with the exact percentage varying from day to day. For a period of a year each hospital recorded the days on which more than 60% of babies born were boys. Which hospital recorded more such days? Larger[22%] Smaller[22%] More or less same (within 5%)[56%]

12. II. Availability Heuristic assessing probability by how easily something comes to mind Which are more frequent: words with K in first position of the word, or words with K in third position of the word? Frequent events will be easy to recall Rare events will be difficult to recall

13. Availability Heuristic Actual frequency influences how easily evidence comes to mind but so do other factors Media Vividness Bias tendency to overestimate rare events - lightening Strikes, plane crashes

14. III. Framing heuristic that affects the subjective desirability of an event by changing the standard of reference for judging the desirability of that event

15. If program A is adopted, 200 of these people will be saved; If program B is adopted there is 1/3 probability that 600 people will be saved and 2/3 probability that no people will be saved Which program would you favour? If program A is adopted, 400 of these people will die If program B is adopted there is 1/3 probability that nobody will die and 2/3 probability that 600 people will die Which program would you favour?