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The ambiguity effect is a cognitive tendency where decision making is affected by a lack of information, or "ambiguity". [1] The effect implies that people tend to select options for which the probability of a favorable outcome is known, over an option for which the probability of a favorable outcome is unknown.
Maxmin expected utility: Axiomatized by Gilboa and Schmeidler [8] is a widely received alternative to utility maximization, taking into account ambiguity-averse preferences. This model reconciles the notion that intuitive decisions may violate the ambiguity neutrality, established within both the Ellsberg Paradox and Allais Paradox.
Explanations include information-processing rules (i.e., mental shortcuts), called heuristics, that the brain uses to produce decisions or judgments. Biases have a variety of forms and appear as cognitive ("cold") bias, such as mental noise, [5] or motivational ("hot") bias, such as when beliefs are distorted by wishful thinking. Both effects ...
For the first decade of life, children’s brains use up to twice as much energy as an adult’s brain. That’s because they go through so much growth and development in those years.
One line of debate is between two points of view: that of psychological nativism, i.e., the language ability is somehow "hardwired" in the human brain, and usage based theories of language, according to which language emerges through to brain's interaction with environment and activated by general dispositions for social interaction and ...
Cognitive dissonance theory proposes that people seek psychological consistency between their expectations of life and the existential reality of the world. To function by that expectation of existential consistency, people continually reduce their cognitive dissonance in order to align their cognitions (perceptions of the world) with their ...
Social Security is a social insurance program officially called "Old-age, Survivors, and Disability Insurance" (OASDI), in reference to its three components. It is primarily funded through a dedicated payroll tax. During 2015, total benefits of $897 billion were paid out versus $920 billion in income, a $23 billion annual surplus.
Common life insurance riders include waiving your premium in the event of a serious illness or injury, adding covering for a minor child and the ability to access your death benefit if you are ...