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ains why they do not always follow the normative theories dictate that they should. 1. Expected utility 2. Heuristic

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Normative theories predict that people should always choose certain options in gambling problems, but ____ theory explains why they do not always follow the normative theories dictate that they should.

1. Expected utility

2. Heuristic

3. Prospect

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