Known as "analytical tools," some examples are the "Devils Advocate," a method in which one argues against the stated conclusion to determine its validity (even though one may not agree with the position), "Lateral Thinking," or Edward de Bono's term for a type of creative thinking involving "pattern-switching within a patterning system." In basic terms, this means taking a look at a statement from a different perspective. For example, de Bono gives the example, "Grandma is knitting and young Susie is disturbing her playing with the wool. The father suggests putting Susie into the playpen. The mother suggests it might be a better idea to put Grandma in the playpen." This definitely gives one a different perspective on the original statement, and the logic behind it!
Additional tools include PMI, with P=good points, M=bad points, and I=interesting points. PMI- Plus/Minus/Interesting. In simple terms, one tallies all positive points in a column, all negative points in a column, and interesting points in a column in which one factors in the extended implications of accepting a statement or action. Of course this is also similar to "CAF" or considering all the factors -- both of which should be commonly used in evaluating statements or possible actions.
In conclusion, there are many types of logical fallacies that confront people in all aspects of life -- from academic and scientific research to even making the most common decisions of daily living. Being able to identify a fallacy...
Specifically, Heuer advocated the use of tools that help the thinker to "...clearly delineate their assumptions and chains of inference," and to "specify the degree and source of the uncertainty involved in the conclusions." Thus, Heuer advocated the use of analytic debate, devil's advocate arguments, brainstorming, competition between analyses, peer review and outside "points-of-view." Edward de Bono, on the other hand, specifically emphasized the value of creativity in the development
Behavioral Finance and Human Interaction a Study of the Decision-Making Processes Impacting Financial Markets Understanding the Stock Market Contrasting Financial Theories Flaws of the Efficient Market Hypothesis Financial Bubbles and Chaos The stock market's dominant theory, the efficient market hypothesis (EMH) has been greatly criticized recently for its failure to account for human errors, heuristic bias, use of misinformation, psychological tendencies, in determining future expected performance and obtainable profits. Existing evidence indicates that past confidence in the
QUESTION 1.Overconfidence (excessive optimism) is very commonly observed in human beings. Overconfidence leads to which types of irrational behavior in financial markets? Please list 3 and explain in detail.i. Over-precisionThe third form of irrational behavior is over-precision, being too confident you know the verity and truths. For instance, Trump shows over-precision when he claims surety concerning opinions not in line with reality. He claimed that Arab Americans in their thousands
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