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1 Judgment and Decision-Making Under Uncertainty Online Quiz Questions

Use this free practice quiz with 20 questions to review 1 Judgment and Decision-Making Under Uncertainty, test your knowledge, and prepare for your next test or exam.

20 questions
01
Choose one
1 point

A quiet, book-loving person seems to fit a librarian stereotype. What is the best way to judge whether this person is more likely to be a librarian than a salesperson?

  1. A

    Classify the person as a librarian because the description resembles a stereotype.

  2. B

    Consider both the description and the prevalence of each occupation.

  3. C

    Ignore all descriptive information and choose the more common occupation automatically.

  4. D

    Treat the description as proof that the less common occupation is more likely.

02
True or false
1 point

True or false: Using a heuristic is necessarily a mistake because heuristics are biases.

  1. A

    True

  2. B

    False

03
Written response
1 point

When time is limited, Maya uses a simplifying strategy to make an estimate without considering every detail. What is this kind of strategy called?

04
Fill in the blank
1 point

After seeing an arbitrary initial estimate, a decision-maker makes an adjustment that is too small, leaving the final estimate pulled toward the .

05
Choose one
1 point

After seeing several vivid news stories about a rare event, someone judges that the event is common, even without checking how often it occurs. Which heuristic best describes this judgment?

  1. A

    Representativeness, because a familiar example resembles a category

  2. B

    Anchoring, because an initial number pulls a later estimate

  3. C

    Availability, because vivid examples are easy to recall

  4. D

    Expected utility, because outcomes have values

06
True or false
1 point

True or false: Expected utility theory claims that people always explicitly calculate probabilities and utilities before choosing.

  1. A

    True

  2. B

    False

07
Written response
1 point

A planner must choose an action, but the probabilities of the possible outcomes are unknown and cannot be estimated reliably. Is this situation best classified as risk or uncertainty?

08
Fill in the blank
1 point

In expected utility theory, each possible outcome’s utility is weighted by its given the action.

09
Choose one
1 point

Two travel routes differ in travel times, reliability, and the chance of delay. How should a decision-maker applying expected utility theory compare them?

  1. A

    Choose the route with the shortest average travel time in every case.

  2. B

    Compare the probabilities and utilities of the possible outcomes for each route.

  3. C

    Choose the route that feels most familiar, without considering outcomes.

  4. D

    Choose the route with the most vivid possible delay.

10
Choose all
1 point

Which statements accurately describe expected utility theory as a normative model? Select all that apply.

  1. A

    Identify possible outcomes and assign probabilities and utilities to them.

  2. B

    Assume the model determines which outcomes each person should value most.

  3. C

    Choose the option with the greatest probability-weighted utility.

  4. D

    Treat the model as a claim that people always calculate explicitly.

11
Choose one
1 point

Which description best characterizes prospect theory in relation to expected utility theory?

  1. A

    A heuristic that estimates likelihood from how easily examples come to mind

  2. B

    A normative rule that calculates the highest expected utility

  3. C

    A bias caused only by neglecting base rates

  4. D

    A descriptive alternative for choices under risk that accounts for patterns such as sensitivity to gains and losses

12
Choose all
1 point

A team wants to improve a decision made under uncertainty. Which practices fit the recommended approach? Select all that apply.

  1. A

    Make the options and possible outcomes explicit.

  2. B

    Treat vivid examples as sufficient evidence of frequency.

  3. C

    Check relevant base rates and other evidence.

  4. D

    State what is uncertain and clarify which outcomes matter.

13
Choose one
1 point

A person estimates the chance of rain, then chooses whether to carry an umbrella based on that estimate and the inconvenience of carrying it. Which option correctly labels the two steps?

  1. A

    Both steps are judgments because they involve uncertainty.

  2. B

    The estimate is a decision, and choosing an action is a judgment.

  3. C

    Estimating the chance of rain is a judgment; choosing whether to carry an umbrella is a decision.

  4. D

    Estimating the chance of rain is a heuristic; choosing whether to carry an umbrella is a bias.

14
Open ended
1 point

A commuter estimates the chance of rain after seeing a vivid weather story, then decides whether to carry an umbrella. Explain how a heuristic and a possible bias could affect the commuter’s estimate. Distinguish the judgment from the decision, and describe one way to improve the reasoning.

15
Choose one
1 point

A quick heuristic produces a plausible recommendation, but the choice has important consequences. Which approach best uses the heuristic while evaluating the decision carefully?

  1. A

    Avoid all heuristics because they inevitably produce errors.

  2. B

    Use a heuristic as a starting point, then compare the judgment with a suitable normative model when needed.

  3. C

    Replace personal values with the values supplied by a normative model.

  4. D

    Assume a normative model can resolve missing probabilities without additional information.

16
True or false
1 point

True or false: Expected utility theory can determine a person’s utilities even when that person’s values have not been specified.

  1. A

    True

  2. B

    False

17
Choose one
1 point

A traveler estimates possible travel times for two routes, then selects a route while considering the value of arriving quickly and avoiding delay. Which statement correctly distinguishes the two activities?

  1. A

    Estimating each route’s possible travel times is a decision, while selecting a route is a judgment.

  2. B

    Estimating each route’s possible travel times is a judgment, while selecting a route using the outcomes that matter is a decision.

  3. C

    Both activities are judgments because travel times are uncertain.

  4. D

    Both activities are decisions because a route must be selected.

18
Choose one
1 point

A planner can reasonably estimate the probabilities of several possible travel delays, though the actual delay is not yet known. Which concept best describes this situation?

  1. A

    It is uncertainty because the outcome has not happened yet.

  2. B

    It is uncertainty because every estimate of probability is necessarily unknown.

  3. C

    It is risk because the probabilities are reasonably estimable.

  4. D

    It is neither risk nor uncertainty because there is more than one outcome.

19
Written response
1 point

What is the term for a systematic tendency that can skew judgment?

20
Written response
1 point

An action has two possible outcomes: utility 88 with probability 0.70.7, and utility 22 with probability 0.30.3. Using EU(a)=∑ipiU(oi)EU(a)=\sum_i p_iU(o_i), what is the action’s expected utility in utility points?