Instructor:

Dr. Varun Dutt

Assistant Professor
IIT Mandi

Assignment – 3
Decision Making for Social Change

HS-523

Question 1: Consider this problem: (4000, 0.8; 0, 0.2) and (3000, 1.0). What is
the option one should choose based upon expected values? What is the option
most people choose and why?

Question 2: Please sketch the shape of value function and weighting function
based upon Prospect Theory. Please explain briefly how people make choices
according to prospect theory (using prospect value)?

Question 3: What is the influence of probability and outcome - valence on

people's choices in gambles?

Note: Please mention the student name and roll number (of all the group
members) on your solution. Please submit a single solution per group.

Submission Deadline: Submit before 11:59 PM on 5th April, 2019.