MRKT 452 Lecture Notes - Lecture 12: Flood Insurance, Natural Environment
11 Jun 2018
School
Department
Course
Professor
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Document Summary
Judgement heuristics - mental rules/shortcuts for making judgements. Availability - vivid information (easily remembered) is more important/true than less vivid information. Easy to visualize = e. g. showing the food pyramid in a plate vs. pyramid. Easily remembered information has a ring of truth = becomes a. Saving money is a loss and the things you can buy with that money is vivid = people overlook the power of compounding and don"t save early. Pictures help refugees, end wars, increase charitable donations, etc. all vivid. Easy to visualize losses using cash vs. credit card = leverage this to increase savings. Use this to choose what issues to vote on. Climate change, water conservation, preventative health care, reducing public debt = hard to visualize benefits, low availability. Better health care, schools, roads, hospitals, jobs = easy to visualize benefits, high availability. Used for probability, time, money, quantity, and liking judgements.
