prospect theory

Popular Terms
Theory that suggest that individuals place more emphasizes on gains rather than losses and as a result will try to make decisions that contribute to gains. The prospect theory lumps risks into two categories: those that contribute to gains and ones that contribute to losses. Under this theory, people treat the two sections of risk totally different in order to receive a positive outcome. Prospect theory was developed by Daniel Kahneman and Amos Tversky in 1979.

Use 'prospect theory' in a Sentence

Prospect theory would explain the choice of focus in the meeting by the director, psychologically some bias can exist in our perception.
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You need to break down the prospect theory and see if you can utilize it to your businesses advantage in any way.
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It is important for us to assess every decision we make with strong regards to prospect theory, because we must understand the types of risks we associate with.
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