Reference no: EM131123804

Question 1. a) Describe a ‘real world' example where you or others judged a decision based on its outcome. Explain what the problem is with evaluating the quality of a decision based on outcomes, and offer a better approach to evaluating this same decision.

b) Reconsider the important and difficult decision you described in an earlier class. In light of this course's lectures and readings, would you evaluate it differently now, and how. Explain briefly.

c) Why do you think that decision makers pay so much attention to outcomes, even when they do not want to?

Question 2. Describe a recent consumer choice you made and present the information as a table.

a) Describe the process if you used the Satisficing strategy to make your choice, then state what your choice would be using this strategy.

b) Is Satisficing compensatory or non-compensatory and why (Define compensatory and non-compensatory)?

c) In the same example, show how you would choose using the lexicographic strategy.

d) Is Lexicographic a compensatory or non-compensatory and why? Did you choose the same thing, if not, why not?

e) When is it appropriate to use compensatory versus non-compensatory and vice-versa? MG110

Question 3. a) How do people decide naturally when there is ‘lots of choice'? (Think about strategies).

b) Do you expect lots of choice to be more difficult to cope with for maximizers or satisficers and why? Describe a Maximizer and a Satisficer, in your answer.

c) Drawing on your entire course so far, how can one help people choose better? Illustrate with an example.

Question 4. The FSA is an independent UK Government department set up in 2000 to protect the public's health and consumer interests in relation to food. Imagine that you have been asked to advise the Food Standards Agency (FSA) about how to inform the public about the risks and benefits posed by genetically modified food.

a) What are the main factors which influence how people perceive risk? Use theory to justify your answer.

b) Give two examples of events or hazards which are perceived very differently by the general public, and explain why.

c) Based on your answer given in a) how do you think people will perceive GM food and why? Focus on the theory surrounding how people perceive risk.

d) What advice would you give the FSA when communicating the risks and benefits associated with GM food?

Question 5. We saw that preferences are constructed.

a) Explain what we mean by that, highlighting in what ways context shapes and affects preferences and choices. Refer to the lectures, class notes and readings assigned.

b) Give four examples of how context shapes and affects preferences. Name the effects that you described in your examples. The examples must illustrate four different effects.

c) As a decision analyst, explain why it is important to know that preferences are constructed

d) What does behavioral science say about the implications of an opt-out organ donation policy for organ donation rates?

e) Do you think an opt-out organ donation is ethical and saves lives? MG110

Question 6 Imagine you have a serious non-urgent knee problem. Your GP recommends you undergo a knee replacement surgery. In this surgery, the doctor removes damaged cartilage and bone from the surface of your knee joint and replaces them with a man-made surface of metal and plastic. In order to have this operation you will have to go to a hospital. The table below shows the 5 hospitals you can choose from.

a) Imagine that Location were the most important criterion to you. What hospital would you choose if you used a lexicographic strategy? Spell out your choice process if you used the lexicographic strategy and Hospital X were 2 miles away.

b) Would you recommend or discourage using a choice strategy of this kind, and why?

c) Based on the behavioural research you know, list all the factors that you think render the choice of one hospital from these five difficult. For each of these factors, describe how an unaided decision maker would choose. In your answer make reference to the table and give specific examples.

d) Imagine that the table below were designed with a "default" selection, i.e. would always present one of the 5 hospitals as pre-selected. Of course, people can change the selection if they want.

1. Do you think that including a ‘default' would help people make their choice? If so, how? If not, why?

2. Imagine advising the NHS on how to set this default. What hospital of the 5 would you suggest as the best ‘default', and why?