The Effects of Problem Representation on the Sure-Thing and Substitution Principles

Article Abstract:

This paper reports an experimental investigation of the effects of three forms of problem representation on compliance with the Sure-Thing and Substitution Principles. The most common form of representation, written problem statements, was compared with two visual representations: decision matrices with each column proportional in size to the probability of the corresponding event and tubes containing 100 labeled balls. The proportional matrices led to fewer violations of both principles. Moreover. when subjects were trains to construct proportional matrices from written problem statements, they exhibited even fewer violations. (Reprinted by Permission of Publisher.)

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The effects of problem representation on the Sure-Thing and Substitution principles

Article Abstract:

An experimental investigation is reported on the effects of three forms of problem representation on compliance with the Sure-Thing and Substitution Principles. Written problem statements, the most common form of representation, are compared with two visual representations - proportional matrices and balls in tubes. It is found that the proportional matrix representation leads to fewer violations of both the Sure-Thing and Substitution Principles than the written or tubes representations. Furthermore, subjects who were trained to restructure written problem statements into proportional matrices exhibited even fewer violations.

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The art and science of planning at the business unit level

Article Abstract:

Conditions that require different planning approaches are considered. A theoretical planning framework that considers the confidence of causal linkages coupled with the extent of environmental change is presented. The appropriate leadership and decision-making styles for single-businesses, nondiversified firms, and divisions of diversified firms are analyzed. The conditions which call for either computational, consensual, contingency, or conceptual planning at the business unit level are explained.

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