Deck 12: Decision Making

Question 1

What is utility?

A)The desirability or value of a given course of action
B)The simplicity of a given course of action
C)How often we use regions of the brain associated with decision making
D)How much we are willing to pay for an item

Answer 1

A

Question 2

The field that studies real-world decision making using real people is called:

A)Social psychology
B)Behavioral economics
C)Neuroscience
D)Economic philosophy

Answer 2

B

Question 3

Why do restaurants tend to put very expensive items on the menu?

A)The restaurant owners know that a substantial percentage of the population will actually choose the most expensive items because they see themselves are deserving the best
B)The restaurant owners know that expensive menu items make people believe that the restaurant is exclusive and high quality
C)Customers compare the less expansive (but still costly)items with the very expensive choices, and are persuaded that their item is not too expensive to order
D)Customers tend to choose the most expensive items because they want to impress those with whom they are dining

Answer 3

C

Question 4

If you are told that your name is on a list and you may be selected to pay a fine of $500, but can get your name taken off of the list by paying $5, what are you likely to do?

A)Take your chances and expect that you will not be the one selected to pay the fine
B)Try to talk the person down to only paying $2.50
C)Offer to pay $300 instead
D)Pay the $5 to insure that you will not be selected

Question 5

Prospect theory is much better than rational choice theory at describing:

A)How humans will make decisions when acting in a perfectly rational manner
B)How humans make decisions based on gains and losses
C)How humans make choices based on relative preferences
D)How humans make choices based on utility

Question 6

What is the endowment effect?

A)People feel that they are owed more pay for their work then their employer
B)People tend to argue in favor of their past decisions, even if those decisions were obviously to their own detriment
C)People feel that whatever choice they make must be the correct decision, no matter what anyone else says
D)People tend to assign higher value to an object when it already belongs to them

Question 7

When people chose smaller, immediate rewards over larger, delayed rewards, what does that point to about our decision making?

A)We can be irrational when gain is involved
B)We can be impulsive
C)We tend to delay discount
D)All of the above

Question 8

Animals that eat food that is harder to come by may be more prone to:

A)Be risk averse when foraging
B)Take risks when foraging
C)Operate under rational choice theory
D)Attribution errors

Question 9

What is the attribution effect?

A)Deciding on an option because we believe its value will increase over time
B)The tendency for humans to assume that an object has more value simply because we own it
C)The tendency for humans to assume that bad decisions made by ourselves are due to situational factors, whereas bad decisions made by others are due to character defects
D)Believing that other people act irrationally whilst our own choices are rational

Question 10

Neuroimaging studies on decision making show that the ________ regions of the brain are more active during impulsive decisions with an immediate reward.

A)Lateral
B)Dorsal
C)Ventral
D)Medial

Question 11

Subjects in experiments involving choosing smaller, immediate rewards or larger, long-term rewards show activation in which area when choosing smaller, immediate rewards?

A)The medial cortical areas
B)The primary motor cortex
C)The pre-supplementary motor area
D)The lateral cortical areas

Question 12

Activation in the ventral striatum is correlated with:

A)Planning actions that include hand movements
B)Setting goals
C)Pursuing a reward, even when there is risk
D)Remembering past experiences

Question 13

The point of indifference for your laptop would be:

A)The point at which you no longer find your laptop useful
B)The point at which you would be equally happy keeping your laptop or selling it for a particular amount of money
C)The point at which you upgrade your laptop
D)The point at which you would give away your laptop for free

Question 14

The subjective vale of an item is:

A)The worth of an item to a given individual
B)The monetary amount needed to buy an item
C)The sum an individual has paid for an item
D)The durability of an item

Question 15

In the experiment performed by De Martino, Kumaran, Seymour, & Dolan, participants were given $50 and were asked whether they would gamble on an all-or-nothing bet, or just keep $20 of the $50 they were given. The only difference between two groups was the framing of that question. What was the outcome?

A)Those who chose between the all-or-nothing bet and "keeping $20" chose to bet, whereas those who chose between the all-or-nothing bet and "losing $30" chose to lose the $30.
B)Both groups chose to go for the all-or-nothing bet.
C)Both groups chose to take the sure thing, even though it was framed as a gain for one group and a loss for the other group.
D)Those who chose between the all-or-nothing bet and "keeping $20" chose to keep the $20, whereas those who chose between the all-or-nothing bet and "losing $30" chose to bet.

Question 16

One of the brain regions that is active when assigning subjective value of monetary rewards is:

A)The posterior cingulate cortex
B)The medial prefrontal coretx
C)The nucleus accumbens
D)All of the above

Question 17

Activity in which brain region is associated with being able to stick to a diet/exercise?

A)Posterior temporal cortex
B)Ventrolateral prefrontal cortex
C)Hippocampus
D)Superior temporal cortex

Question 18

What is the difference between cognition and conation?

A)Cognition is driven by perception, whereas conation is driven by emotion
B)Cognition is performed in the cortex, whereas conation is performed in the cerebellum
C)Conation only occurs in animals
D)Cognition involves an action, whereas conation only involves thought

Question 19

The pre-supplementary motor area is active when a person:

A)Responds with hand movement to an external cue
B)Moves their hand in response to a set of directions
C)Chooses on their own when to make some sort of hand movement
D)All of the above

Question 20

When a subject in an experiment decides on their own, with no external cues, to wave their hand back and forth, this area of the brain should be active:

A)The pre-supplementary motor area (pre-SMA)
B)The orbitofrontal cortex
C)The primary motor cortex
D)The ventromedial prefrontal cortex

Question 21

When trying to minimize potential losses during an experiment on strategy decisions under risk, the dorsomedial prefrontal cortex increases connectivity to these areas:

A)The orbitofrontal cortex and the basal ganglia
B)Insula and amygdala
C)The dorsal striatum and the ventral striatum
D)The pre-supplementary motor area and the supplementary motor area

Question 22

This orbitofrontal cortex is associated with:

A)Goal-tracking
B)Plan-selecting
C)Emotion-modulating
D)All of the above

Question 23

Impulse control and decision making are associated with which neurotransmitter?

A)Acetylcholine
B)Norepinephrine
C)Serotonin
D)Glutamate

Question 24

Higher tetrahydrocannabinol levels are associated with increased _______ on some simple measures.

A)Impulsivity
B)Anxiety
C)Risk-aversion
D)Depression

Question 25

Stressful situations can result in:

A)Poor decision making
B)Higher cortisol levels
C)Increased impulsivity
D)All of the above

Question 26

In the story of the climbers who perished on Mount Everest, what factors COULD have contributed to their poor decision making (at the cost of their lives)?

A)Belief that they could make it to the top and be back to basecamp in time, despite warnings that they needed to turn around by 2:00 P.M."
B)Their physical condition-the lack of oxygen effected their judgement"
C)Pride-who wants to say they tried to climb Everest and didn't make it to the top?"
D)All of the above"

Question 27

Making a choice only after considering the alternatives is called a:

A)Hypothesis"
B)Theory"
C)Decision"
D)Judgement"

Question 28

A decision involves:

A)A plan of action"
B)At least two alternatives"
C)A goal"
D)All of the above"

Question 29

What does Aesop's tale of The Scorpion and the Frog say about human nature?

A)Humans often weigh decisions carefully before making a choice"
B)Humans always make a rational choice, even if it is not the ""correct"" choice"
C)Humans are prone to act on impulse, even when it is to their detriment"
D)Humans display risky behavior because they like the thrill it gives them"

Question 30

Which discipline has studied and debated the reasons for making good and bad choices?

A)Religion"
B)Philosophy"
C)Neuroscience/Psychology"
D)All of the above"

Question 31

Who was the philosopher behind the modern concept of utilitarianism?

A)Amos Tversky"
B)Isaac Newton"
C)Jeremy Bentham"
D)Daniel Kahneman"

Question 32

Jeremy Bentham is the philosopher behind the modern concept of:

A)Loss aversion"
B)Utilitarianism"
C)Prospect theory"
D)Behavioral economics"

Question 33

What does utilitarianism state about human decision making?

A)Choices are often made based on external cues"
B)Humans are very consistent in the way they make decisions"
C)Humans make choices solely on monetary value"
D)Every choice has a value, which is the amount of happiness or pleasure it would bring to others"

Question 34

What is expected utility?

A)How often we expect to use an item"
B)How much we think an item will be worth in the future"
C)How valuable something is at this moment in time"
D)How valuable something will be in the future if the outcome is ""right"""

Question 35

Decision models based on utility often assume that people are making _____ choices:

A)Selfish"
B)Random"
C)Rational"
D)Poor"

Question 36

The rational choice theory assumes we are dealing with:

A)The framing effect"
B)Homo economicus"
C)Quasi-hyperbolic discounting"
D)The endowment effect"

Question 37

What is a defining characteristic of Homo economicus?

A)He changes his decisions base on context"
B)He desires to maximize gains and minimize losses"
C)He will buy a good expecting to sell it for higher price"
D)He often gambles for large but unlikely rewards"

Question 38

Rational choice theory assumes that a human will:

A)Expect to sell for a higher price than the purchase price"
B)Not be swayed by emotional considerations"
C)Have medial areas of the cortex activated while making a decision"
D)Chose different options depending on how they are described"

Question 39

What tends to happen when humans are presented with two options (A and

A)We will be swayed toward the inferior option (C), as we tend to assume that is the least costly"
B)We will be swayed toward the superior option that is least like the inferior option (B), as we want nothing to do with the inferior good (C)"
B), and then with a third option (C), which is inferior to the other two, more more like one (A)than the other (B):
C)
We will be swayed toward the superior option that is most like the inferior option (A), as it now looks even better by comparison to the inferior option (C)
D)
None of the above

Question 40

What is a relative preference?

A)You always choose the most expensive item"
B)You choose what what looks appealing compared to what others have chosen"
C)You choose what is easiest to attain"
D)You choose one option, but then change your mind after exposure to other options"

Question 41

You are asked whether you would prefer milk or dark chocolate, and choose milk, but then are asked if you would rather have white chocolate instead. You change your mind and go for the white chocolate. What is the term for this?

A)Delay discounting"
B)Absolute preference"
C)Relative preference"
D)Loss aversion"

Question 42

What is an absolute preference?

A)Your choice may change depending on what otters around you choose"
B)Your choice may change depending on the introduction of new options"
C)Something you choose no matter what the alternative options are"
D)All of the above"

Question 43

When you go to your favorite restaurant, you always choose the same dish. It doesn't matter the time of year, time of day, cost of the dish, or what new items are on the menu. This dish would be a(n):

A)Intertemporal choice"
B)Absolute preference"
C)Relative preference"
D)Primary reward"

Question 44

What is the point of indifference?

A)The point at which you don't care what you choose, just as long as a decision is made"
B)The point at which you take a risk in order for a decision to be effective"
C)The point at which one will take on a riskier option for the greatest good for the greatest number of people"
D)The point at which one will avoid risk by taking a lesser, but sure, option"

Question 45

What does it mean to be risk averse?

A)You will make a poor decision in order to avoid loosing money or possessions"
B)You do not even consider risky options"
C)You will pay a substantial penalty to avoid risk"
D)You avoid risks at all costs"

Question 46

If given the opportunity to enter a drawing for $500, or, take $10 right now, what kind of choice would it be considered to take the $10?

A)Risk seeking"
B)Absoute"
C)Risk aversive"
D)Indifferent"

Question 47

When do humans become risk seeking?

A)When the penalties are low"
B)When the reward is considered to be large"
C)When the odds of winning are low"
D)When the alternatives are favorable"

Question 48

Why are insurance companies so successful?

A)The odds of something very costly happening are actually quite high"
B)The sales people are very convincing"
C)People are willing to pay now in order to feel sure that they will not have to pay a high amount later"
D)People are incredibly risk-seeking"

Question 49

Why does the lottery system make so much money?

A)People know that the odds of winning are actually higher than most people think"
B)In some states, some of the profits go to fund the pubic schools"
C)People are willing to spend a little in hopes of gaining a huge reward"
D)The commercials are very appealing"

Question 50

In an experiment, I tell two groups that 200 people are infected with a deadly disease. If I tell Group A that they must choose between a 50% chance of saving the lives of all 200 people, or a 100% of saving the lives of only 50 people, and Group B that they must choose between a 50% chance of all 200 people dying and a 100% chance of 50 people living, what should we expect to happen, given the framing effect?

A)We should expect both groups to choose the 100% of saving 50 people"
B)We should expect Group A to choose the 50% chance of saving everyone, while Group B chooses the 100% of saving 50 people"
C)We should expect Group A to choose the 50% chance of saving 50 people, while Group B chooses the 50% of everyone perishing"
D)We should expect both groups to choose the 50% of saving everyone"

Question 51

Which of these may be a side-effect of the endowment effect?

A)Delay discounting"
B)Loss aversion"
C)The attribution effect"
D)Expected utility"

Question 52

What is delay discounting?

A)Value remains constant over time"
B)Value fluctuates over time"
C)Value increases over time"
D)Value declines over time"

Question 53

What do humans TEND to do when faced with the decision of pleasure now, or more pleasure later?

A)They bargain"
B)They chose a smaller amount of pleasure now"
C)They choose the higher amount of pleasure later"
D)They waffle back and forth between the two, unable to make a decision"

Question 54

Why is it interesting that people tend to choose $250 in 53 weeks over $200 in 52 weeks, but also choose $200 now versus $250 in one week?

A)Time is irrelevant when considering increases in gain"
B)People are very inconsistent in whether or not they care about monetary gains"
C)In both scenarios, the person will gain an extra $50 by waiting one week"
D)In one scenario, people do not mind waiting, but in the other scenario, they do mind waiting"

Question 55

Which behavior shows steep discounting?

A)Spending $400 on new clothing when you are trying to save for college"
B)Taking harmful (albeit temporary pleasureful)drugs"
C)Eating a slice of cake when you are trying to lose 15 pounds"
D)All of the above"

Question 56

Which is true about human decision making?

A)Humans rarely let their emotions in turfier with their decision making"
B)Humans will assign high value to delayed rewards and forgo immediate pleasures in order to reach them"
C)We tend to chose immediate, pleasureful options, even when we know it would be better not to do so"
D)People often weigh their choices carefully and chose the most rational and ""safe"" options"

Question 57

Other primates seem to have what in common with humans when making decisions?

A)The ability to put their emotions and experiences aside"
B)The framing effect"
C)Impatience to wait for delayed primary rewards"
D)The ability to wait long periods of time for high monetary rewards"

Question 58

When capuchin monkeys show a preference for fruit over cereal when they are already in possession of fruit, and a preference for cereal over fruit when they are already in possession of cereal, they are displaying:

A)Risk seeking behavior"
B)Risk aversion behavior"
C)The endowment effect"
D)The framing effect"

Question 59

Food is an example of a(n):

A)Absolute preference"
B)Attribution"
C)Primary reward"
D)Subjective value"

Question 60

When operating under the intuitive system, people:

A)Think explicitly and can explain their choice"
B)Commit attribution errors frequently"
C)Make choices based on external cues and ignore feelings, emotions, and past experiences"
D)Make a choice unconsciously and cannot explain their preference"

Question 61

When operating under the rational system, people:

A)Tend to assign greater value to items they currently possess than those they do not possess"
B)Make a choice unconsciously and cannot explain their preference"
C)Think explicitly and can explain their choice"
D)Will make poor decisions based on instant gratification"

Question 62

When individuals think explicitly and can explain their choices, they are operating under:

A)Behavioral economics"
B)The Ultimatum Game"
C)The intuitive system"
D)The rational system"

Question 63

Breaking down a behavior into its component actions and going through each one is referred to as:

A)Parallel processing"
B)Sequential processing"
C)Quasi-hyperbolic discounting"
D)Delay discounting"

Question 64

Why might the human rational system operate slowly?

A)There are many regions of the brain associated with the system"
B)A slow processing speed is the only way humans are able to think rationally"
C)We tend to always use sequential processing"
D)It is relatively new in evolutionary terms"

Question 65

Some areas of the brain are active during both intuitive system use and:

A)Risk seeking"
B)Parallel processing"
C)Rational system use"
D)Sequential processing"

Question 66

The medial orbitofrontal cortex is active when a person is making a decision that involves immediate access to ______ as one of the options.

A)Food"
B)Drink"
C)A mate"
D)Money"

Question 67

The limbic system is involved in decisions when there is:

A)A large expected loss"
B)An immediate reward"
C)Great risk"
D)A delayed reward"

Question 68

Subjects in experiments involving choosing smaller, immediate rewards or larger, long-term rewards show activation in which area when choosing larger, long-term rewards?

A)The medial motor areas"
B)The medial cortical areas"
C)The pre-supplementary motor areas"
D)The lateral cortical areas"

Question 69

A TMS study by Figner et al. shows that disrupting the lateral prefrontal cortex does indeed result in:

A)Choosing larger, long-term rewards"
B)The inability to make a decision"
C)Loss aversion"
D)Choosing smaller, immediate rewards"

Question 70

The TMS study performed by Figner et al. demonstrates how a ___________ can result in a change in decision making.

A)Tryptophan"
B)Stress"
C)Lesions"
D)Loss-of-function"

Question 71

Pursuing a reward, even when risky, is correlated with activation in the:

A)Medial orbitofrontal cortex"
B)Anterior insula"
C)Ventromedial prefrontal cortex"
D)Ventral striatum"

Question 72

The lesion study performed by Clarke et al. showed that patients with lesions on their anterior insula did what during the task?

A)Chose long-term rewards even when immediate rewards were not much smaller than the long-term rewards"
B)Chose immediate, smaller rewards even when long-term rewards were very high"
C)Disregarded risk and bet high even when the chances of losing were high"
D)Were extremely loss-aversive and bet small amounts of money even when chances were in their favor"

Question 73

Stronger activation in the right insula during selling decisions is correlated with:

A)Lower loss aversion"
B)Higher framing effect"
C)Stronger endowment effect"
D)Weaker endowment effect"

Question 74

An individual exhibits a strong endowment effect by trying to sell their own car for much more than it is worth. Which brain region is likely active during this decision?

A)The lateral orbitofrontal cortex"
B)The pre-supplementary motor area"
C)The right insula"
D)The dorsolateral prefrontal cortex"

Question 75

When buying an item, the activity of the ventral striatum goes up when:

A)The item is rare"
B)The item is perceived as very expensive"
C)The item is desirable"
D)There is a good bargain"

Question 76

When buying an item, the medial prefrontal cortex activity goes up when:

A)The item is perceived as very expensive"
B)The price goes down"
C)The item is desirable"
D)The price goes up"

Question 77

Sales and bargains are associated with greater levels of activity in the:

A)The lateral cortical areas"
B)The right insula"
C)Medial prefrontal cortex"
D)The supplementary motor area"

Question 78

The imaging study performed by De Martino, Kumaran, Seymour, & Dolan on the framing effect operates under which theory?

A)Contextual theory"
B)Loss-of-function theory"
C)Rational choice theory"
D)Prospect theory"

Question 79

Activation in the ventromedial prefrontal cortex is correlated with:

A)High endowment effect"
B)Loss aversion"
C)Rationality and resistance to the framing effect"
D)Impulsivity and low sales-resistance"

Question 80

The axiom of revealed preferences is used in association with:

A)The endowment effect"
B)Subjective value"
C)Loss aversion"
D)Parallel processing"