COST ACCOUNTING
INFORMATION FOR DECISION MAKING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Which of the following are considered traps of decision making?
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Regretting Past Decisions
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Following Tradition
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Creating Crisis Situations
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Making everything a Life or Death Situations
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Following safety laws
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Explanation:
Detailed explanation-1: -The two most common traps that impact decision making are known as confirmation bias and overconfidence bias.
Detailed explanation-2: -Mental shortcuts and mental accounting, drawing on similar events to solve new problems, and anchoring based on previous knowledge can lead to poor strategic decision making. Loss aversion, hindsight bias, and overconfidence can make us naive to a problem and hide structural issues that need to be addressed.
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