Questions and Answers
What is judgment?
The evaluation of an object or estimate of the likelihood of an outcome or an event.
What is one kind of judgment that is an estimation of likelihood?
Judging how likely it is that something will occur.
What do consumers evaluate when judging goodness and badness?
Their evaluation of the desirability of the offering's features.
What is mental accounting?
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Which of the following is a bias in judgment processes?
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What are the five major types of decisions in high-effort situations?
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What is the attraction effect?
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What factors affect the relevance and importance of various decision criteria?
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What are the two types of decision models used when choosing a brand?
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Match the cognitive decision models with their definitions:
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What does prospect theory state about losses and gains?
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What influences feelings-based decisions?
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What leads to decision delay?
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What are noncomparable decisions?
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What consumer characteristics affect high-effort decisions?
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What does information availability mean in high-effort decisions?
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How does group context affect consumer decisions?
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Study Notes
Judgment and Decision-making
- Judgment involves evaluating objects and estimating the likelihood of outcomes, serving as a fundamental input in decision-making.
- Estimation of likelihood refers to assessing how probable an event is to occur.
Evaluations of Goodness and Badness
- Consumers evaluate the desirability of features when forming judgments on goodness or badness.
- Feelings and emotions influence these evaluations.
- The anchoring and adjustment process starts with an initial evaluation, which is modified with additional information.
Mental and Emotional Accounting
- Mental accounting: Categorizes spending and saving decisions into mental 'accounts' for particular transactions or goals.
- Emotional accounting: Reflects the intensity of feelings associated with each 'account' affecting saving and spending behaviors.
Judgment Process Biases
- Confirmation bias: Consumers prioritize judgments that validate existing beliefs with greater confidence.
- Self-positivity bias: Consumers perceive negative outcomes as more likely to affect others than themselves.
- Negativity bias: Negative information is given more weight than positive information during judgment formation.
- Mood influences judgments, serving as an initial anchor, reducing negative information search, and enhancing overconfidence in decisions.
- Prior brand evaluations: Favorable prior perceptions can hinder the recognition of relevant brand attributes impacting quality.
- Mental calculation difficulty: Simplicity or complexity in calculating prices influences judgment regarding their value.
High-Effort Decision Types
- Identifying brands to consider leads to three sets: inept (unacceptable), inert (indifferent), and consideration (chosen).
- Decision criteria's relevance varies based on consumer goals, timing, and framing context—immediate choices focus on concrete aspects, while delayed choices consider abstract aspects.
- Types of decisions include choosing among brands, identifying relevant attributes, the timing of decisions, and non-comparative evaluations.
Brand Selection Decisions
- Compensatory Model: Balances negative features against positive ones.
- Non-compensatory Model: Rejects options based solely on negative attributes, utilizing cutoffs for each feature.
Cognitive Models for Decision-making
- Multi-attribute expectancy-value models: Evaluate products based on multiple attributes.
- Conjunctive model: Establishes minimum acceptable cutoffs for attributes.
- Disjunctive model: Sets acceptable cutoffs to identify good options.
Decisions on Gains and Losses
- Decisions depend on motivations for seeking gains or avoiding losses.
- Prospect theory: Consumers perceive losses as more significant than equivalent gains.
- Endowment effect: Ownership enhances the perceived value and associated loss of an item.
Feelings-Based Decisions
- Decisions are influenced by appraisals and emotional responses.
- Affective forecasting: Predictions on future feelings stemming from decisions aid in choice processes.
- Imagery allows consumers to visualize product consumption, incorporating emotional responses into decisions.
Decision Delay Factors
- Decision delay occurs in situations perceived as risky, involving unpleasant tasks, too many choices, or uncertainty in acquiring product information.
Noncomparable Decision Strategies
- Alternative-based strategy: Evaluates options overall using pros and cons.
- Attribute-based strategy: Simplifies decisions by making abstract representations of comparable attributes.
Influences on High-Effort Decisions
- Consumer characteristics like expertise, mood, time pressure, and extremeness aversion significantly shape decision-making.
- Expertise facilitates comprehension of preferences; good mood enhances decision quality.
- Time pressure leads to reliance on fewer attributes, emphasizing negative information.
- Extremeness aversion favors moderate options over extreme ones.
Decision Characteristics
- Availability of information can complicate or simplify decision-making processes.
- High information levels lead to detailed strategies, while low or ambiguous information often favors existing brands.
- Decision formats (brand vs. attribute organization) can direct consumers towards specific processing strategies.
Influence of Group Context
- Group dynamics can shape individual decision-making by balancing personal and collective goals.
- Self-presentation, minimizing regret, and information gathering are primary motivations within a group context affecting consumer choices.
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Description
This quiz covers key concepts from Chapter 8 on judgment and decision-making based on high effort. It includes important definitions and examples essential for understanding how consumers make judgments about likelihood and outcomes. Test your knowledge and comprehension of this critical psychological topic.