Decision Analysis: Blog 1

Decision Analysis: Blog 1: "Read this text about Decision Making Heuristics (http://www.studentpulse.com/articles/180/3/decision-making-factors-that-influence-decision-..."

Eugenio Ramirez
Decision Analysis
Professor John Wetherell


Heuristic
- Definition- To enable a person to discover or learn something from themselves.
- They reduce mental effort in decision making , but they may lead to biases or errors in judgment.

Examples

1) Anchoring and Adjustment -People start from a reference point or approximation (the anchor) , then makes ad judgments, based in additional information. In supermarkets the way price are put is very important to make the consumer think they are buying it cheaper for what really is. An example is an item that is being sold for €50 and in another similar store is placed for €49.99. What are people going to buy? The second item, even though they are the same prim exempt for a minimal difference of one cent people are still going to think is much cheaper because is below the €50 barrier.

2) Availability - People predict the frequency of an event, based on how easily an example can be brought to mind.
-Example-There is people that think that motorcycles are not safe and people that think they are safe. I am one of the people that think are not only dangerous but very dangerous. First because I was brought up with the idea that bikes are coffins with wheels. I personally know a lot of people that have been injured in bike accident . I also don’t' trust other driver and the fact the there is no protection makes me want to ride less. I also know that about only 14% of the people involve in accidents are not injured. So I will rather walk or use other transportation even though it takes more time, than driving on a bike.

3) Representative- People judge the probability or frequency of a hypothesis by considering how much the hypothesis resembles available data as opposed to using a Bayesian calculation. Ex. "Antonio has the presence of a Politian, the humbleness of a peasant and the gift of people". What is he? A leader"


People regret their decision for several reasons. They think they could have made a better choice, they assume responsibility of the bad decision taken, they don't felll satisfied in their life because of the choice taken, the did not reach or meet their goal.


Example of personal decision

After presenting my thesis and final cases. I did not know what was going to be the next step of my life, so I spend a couple of months focusing in personal achievements and looking for opportunities. It came on January where my family offered me the opportunity to study in any University I wanted in the United States. To be honest at the beginning I did not like the idea because I am very happy in Barcelona. I thought about it a lot because it was a great opportunity that I had to take it or not, plus my family would be disappointed if I rejected the offer. I thought about it but the most important think was to choose the city and the University I wanted to live in and attend in other to make my decision. I really did not have any choice because the satisfaction and pride my family has towards my is one of the most important things in my life. I really do not like the States, I have live there many years in different places and I have my personal reasons. Since that moment I was establishing pros and cons about the countries looking at Europe as a big country like the US. The only city in the States that I knew and felt comfortable was Miami, this is because in 2003 I attended for one year to The University of Miami also known as UM and because the people that control the city are Cubans and Latin American were we all Latin share the culture among other things and is easier to establish a relationship. In most other cities they look at Latin-American, specially Mexicans lower than themselves, when I go to the airport they interrogate me as if I was going to visit the Pope and taking me pictures and registering my digitals like if I was a convict. Where is the diplomatic reciprocity? most of the countries don’t apply it, thank God I don’t need this insults. Miami is different it is not the US. Personally I love that University, the campus and the live and the environment in the campus is unbelievable, I met a lot of interesting people and I had the time of my life. There was only one thing, I got feed up of the city and the superficial environment most of the people in Miami are engaged to a society that is not real, so everybody fakes. The geography compare to Europe it has nothing to do with Miami. In Barcelona I have the beach in the summer and the mountains in the winter plus all Europe is very close, one hour and a half to Rome and Paris. In Miami the beach is beautiful but there is nothing else besides clubs and restaurants, there is no culture, no history. I started to think positively about Miami, looking only at its positive aspects and not paying attention to the negatives. First I apply to UM, being the only University I wanted to apply and was going to apply. I wrote a letter explaining my situation, I send the application with its question answers explaining I did not graduated yet because I dropped out from law school after 4 years and I decided only to work, I had the number of years required of working. My decision was made I was going to life in Miami and most probably even If I did not get accepted I was only going to that University, it was my only choice. Later I got a email from UM asking me to personally go and interview myself. I organized the trip having my family meet showing the my future University and some apartments I had already booked. I went there, did a very good interview where they where going to consider the years I worked. I told them I had studied there before and how much I liked the University, the classes, the teachers and how much I learned, they seemed happy, I was sure I was going in. I come back to Barcelona I needed my diploma so I go to uni and I find out I still needed to complete 12 subjects, it was a lot. The only way was taking them privately even though is very expensive. I told administration and the process was on work. This was situation that was not expected, I had to react quick because I barely had time to make the decision but I made it. A couple of days later I received the most unexpected mail, a mail from the person that interviewed me in UM saying the my University was not accredited so they dropped my file, telling me they where sorry. This really tear me apart, it was a very big hit for me. All the illusion, changing my mind , accepting to leave Barcelona, a city where I had live almost 4 years where I had never been happier in my life. I never lost hope, even I still have it. Told the Uni my problem and they sais they said the uni was accredited and that they were sending a letter. Of course I could not tell this to my family, that I was not accepted because my uni was not accredited! After spending a significant amount of time and money. So I waited with hope, and I waited and IM still waiting. Um answer me telling me the letter was sent to International Affairs. I had to tell a member of my family, I told my mom, she came to personally talked to the Uni. They said the same, that it was accredited but what matters at the end is what the UM says or not?? I think another letter was send a couple of months ago and I’m still waiting for an answer. SO now I am in Barcelona having to finish and pay an university where I was going to finish and I was not get in the uni I wanted being my uni one of the most expensive in the country. This fact did not motivate me at all but I could not waist time being sad, so I started to look at Universities here in Barcelona. I chose only EADA so I apply but only as a second option. I got successfully accepted , I am finishing my BBA so now I am just waiting for the green light to go to Miami but if I do not I will be equally satisfied with my decision. This makes me feel good because is a win-win situation I focus more in the positive aspects and less in the negative, so I always win.