The psychology of decision-making explores the processes that individuals use to choose between options. It delves into factors like cognitive biases, heuristics, and emotions that influence choices. Prospect theory, for instance, highlights how people weigh potential gains and losses asymmetrically. Additionally, the framing effect shows that the way options are presented can alter decisions. Understanding these psychological nuances aids in fields ranging from economics to behavioral science, providing insights into why and how people make the choices they do.
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