MHR 405 Chapter Notes - Chapter 7: Satisficing, Subjective Expected Utility, Bounded Rationality
5 Dec 2014
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Document Summary
Decision making the conscious process of making choices among alternatives with the intention of moving toward some desired state of affairs alternative in a decision. Rational choice paradigm the view in decision making that people should and typically do use logic and all available information to choose the alt. w/ highest value profit, satisfaction, well- being) Subjective expected utility the probability (expectation) of satisfaction (utility) resulting from choosing a specific. Select altneratives that offer the greatest level of happiness/maximization. The max. subjective expected utility depends on the value (utility) of outcomes resulting from that choice & the probability of those outcomes occurring. Rational choice decision making process: identify problem or recgonize an opportunity. Problem deviation btwn. current & desired results, that needs to be corrected. Oppurtunity deviation btwn. current expectations & better situations that weren"t expected: how to decide what process to apply to make decision. Programmed decisions follow standard procedures & has similar solutions in past that are identical/doc.
