Ethical Decision Making Summary

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Daniel Kahneman, an Israeli psychologists and a Noble Prize winner for economics, has

discovered that economists don't make decisions as normal people would do. Theory of

economic behavior has always been a subject for debate and analysis. Scholars have been trying

to understand why economists behave like calculating robots and how they make rational

decision in buying stocks and more. In this book, Kahneman used the concepts from psychology

to explain behavioral economics.

One of the highlights of his decade long research, Kahneman has laid out an architecture

of human decision-making, a map of mind which is comparable to a finely tuned machine. He

cited several examples to illustrate people's systematic non-logical patterns …show more content…

In addition, behavioral decision research has dim to

other academic fields quicker than any topic in the history of psychology. Moreover, Danny has

been accepted with the Nobel Prize in Economics, among several other well-deserved awards.

However, for the past 35 years, one continuing criticism of the behavioral decision research

areas, particularly with the work that focus on heuristics and biases, is that it does not present

adequate details regarding the psychological mechanisms underlying the fascination impacts it

documents. This issue regarding the nature of the field and the nature of evidence needed for

journal publication that might be responsible for behavioral decision research developing more in

professional schools than in psychology departments in incoming years. (Of course there are

different explanations.) Furthermore, with so much of the field falling away from psychology

departments, there was less of a push for researchers in order to explain the underlying

psychological mechanisms. While, answering several questions regarding the …show more content…

These tools are important for every business in

order to achieve the organization' goals in an efficient manner. One of these important concepts

is understanding the organization's demand and measure it using price elasticity of demand. One

of the essential tools used in managerial decision-making is forecasting. Forecasting is a method

used to predict the future aspects of business. This is important since it allows the firm to manage

the critical aspect of the firm by planning for its future. If an organization uses past data to

foresee its future and prepare for it through developing appropriate strategies and pursue critical

decisions allows the company to achieve long-term success.

Cost effectiveness analysis (CEA) refers to a type of decision analysis in which the

consequences and costs are carried in a systematic way. It is also considered as a decision

centered tool which relates the cost to its outcome (cost being the numerator and outcome being

the denominator. Wherein, units of effectiveness are measured through any quantifiable outcome

in relation to the program's objective. For example, the units of effectiveness in a

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