People make a variety of mistakes when making decisions. these mistakes are generally associated with a host of biases that occur when we use judgmental heuristics which are rules of thumb shortcuts people use to reduce information processing demands. we often use them automatically without conscious awareness. the use of heuristics decision-makers to reduce the uncertainty inherent in the decision-making process. because these shortcuts are representative of knowledge we gained in the past, they are useful in evaluating current problems but can also lead to systematic errors that erode the quality of decisions. in this activity, you are asked to identify several common decision-making biases.
professor french tells you that south africa’s stock market undervalued and suggests that it is a good investment. you discover that south africa is about to impose a new tax on security transactions, which will result in lower liquidity. in the next class, you bring this to professor french’s attention. simultaneously, another student mentions that as commodity prices recover south africa’s stock market will rise sharply. dr. french ignores the information you provide and congratulates the other student on excellent research. which type of bias is professor french displaying? explain briefly.