Decision-Making Theory: The Three Types Of Decision Making

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Decision making theory
Introduction:
Why do we do what we do? Almost everything that a human being does part-take making decisions this is why making decisions is one of the most important activities of human beings. Individuals have to face variety of options and alternatives and they have to make decisions without knowing the results. Decision making process is made up of step by step. The assurance of this process is on setting a criteria, then weighing the results and the alternatives before reaching a final decision. The process of decision making requires creativity in analyzing every elements and options based on how every person thinks considering the consequences of each and every final decision.
Definition: Decision making tries …show more content…

Many studies and researchers show that decision makers can’t always make up their minds in the right way while making decisions. The personality of each individual is determined by the way he makes decisions

Types of decisions:
1) Normative decision: “ is a model about how decisions should be made in order to be rational.” This type is consist of principles that introduce how decision makers should decide.
2) Descriptive decision: shows what people with different personalities actually do. It uses cognition to describe the decision changeability at different attitudes rather than giving a solution.
3) Perspective decision: “is a model about what people should and can do.”
Models of decision making:
 There are many theories and views may be found in the literature, which are:
1) The rational model: the process of rational decision making contains a number of steps such as:
 Intelligence: “finding occasions for making decisions.”
 Design: “inventing, developing and analyzing possible courses of action or alternatives.”
 Choice: “selecting a particular course of action from those available.”
 Review: “assessing past …show more content…

Frequently Many small decisions must be made before Complex decision could end up in the best conclusion. Moreover, each decision directly or indirectly, may have an impact on other decisions in subsequent models. Which makes it complex to make a decision?

Paradox of choice:
People assume that the more choices available means the better options and the more satisfaction. But beware of excessive choice: the excess of choices and options can make you doubt every decisions you make before you even make it, you can set up high expectations unrealistically's, and it can make you accuse yourself for all disappointments and failure. In the long run, this could lead to an incapacity of decision-making. Furthermore a society that tells us that there is no reason or excuse for missing perfection when your options are boundless, and a lot of options can lead to serious depression.
Statistical decision theory:
Many statistical methods are available to arrange evidence, risk assessment, and help in the decision-making. The risks are classified to type I and type II errors can be measured (cost, estimated probability, expected value…) and reasonable decision making is

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