COST ACCOUNTING
INFORMATION FOR DECISION MAKING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Used to make a decision based upon instincts
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Used to make a decision based upon what comes to mind
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When we focus on the first piece of information provided and it affects our decision
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When we focus on information that confirms our already held belief
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Detailed explanation-1: -What is the availability heuristic? The availability heuristic (or availability bias) is a type of cognitive bias that helps us make fast, but sometimes incorrect, assessments. It involves relying on information that comes to mind quickly or is most available to us.
Detailed explanation-2: -The availability heuristic describes the mental shortcut where we make decisions based on emotional cues, familiar facts, and vivid images that leave an easily recalled impression in our minds.
Detailed explanation-3: -Heuristics are mental shortcuts that allow people to solve problems and make judgments quickly and efficiently. These rule-of-thumb strategies shorten decision-making time and allow people to function without constantly stopping to think about their next course of action.
Detailed explanation-4: -First the availability heuristic refers to the use of information that is easily accessible. For instance infrequent and high-impact events can often be easily brought to mind, leading people to overestimate the likelihood of such an event.
Detailed explanation-5: -Examples of Availability Bias Excessive coverage on the news or social media about plane crashes uses vivid images and stories to elicit an emotional response. That’s why many people develop a fear of flying-they remember those images the next time they fly.