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250 Biases in probability assessment
around your estimate so that you are 90% confident that your range
will include the true value of that quantity.
(a) The air distance, in statute miles, from Moscow to Santiago.
(b) The number of gold medals won in the Summer Olympic Games
by Finnish competitors from 1896 to 1992.
(c) The area of Greenland in square miles.
(d) The year the ball point pen was invented.
(e) The year that the H. J. Heinz food manufacturing company
was founded.
(f) The population of Belize in 1990.
(g) Denmark’s gross national product (in US dollars) in 1989.
(h) The year that Louis Braille, inventor of the Braille communication
system, was born.
(i) The average depth of the Pacific ocean in feet (to the nearest
thousand).
(j) The length, in miles, of the river Danube.
(15) The following table summarizes the results of a survey of the
reliability of two makes of personal computer (a cheap brand and
an expensive brand).
Cheap brand Expensive brand
Required repair in year
following purchase 120 40
Did not require repair 24 8
Would you conclude that the cost of the computers is associated
with their chances of requiring repair in the year after purchase?
Heuristics and biases
Much of the research on the quality of human judgment of probability
has stemmed from the work of Tversky and Kahneman 1 who published
their ideas in a series of well-written and accessible papers starting in the
early 1970s. The central theme of Tversky and Kahneman’s work is that
people use rules of thumb or heuristics to cope with the complexities of
making estimates of probabilities. While these heuristics can sometimes
provide good estimates and reduce the effort required by the decision