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Cognitive biases.docx - Cognitive biases are experienced by...

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Cognitive biases are experienced by all individuals in their daily life. Entrepreneurs often take alot of risk in their decision making and that emerges as the only reason they have to be aware ofcommon errors. Human are made of errors in their thinking, memory and thinking. Scholars havefound it contradicting that humans are capable of coming up with a probability theory but usingit in their daily thoughts is hard. There exists cognitive biases that causes judgment or perceptionwhich deviates reality. Changes in our thinking and judgment are common in our lives but it isvery difficult to avoid them as well as mitigating them. The cognitive biases that entrepreneursare associate with are overconfidence, anchoring, illusion of control and conformational bias aswell as optimism.Humans use simple rules and quick thump rules in many different situations in order to come upwith decisions when uncertainty arises (Kahnema, 2011, p.211). There twenty one cognitiveerrors presented by Rüdiger F. Pohl in Cognitive Illusions and among the addressed heuristicsthere are a lot of them which are utilized by entrepreneurs in their decision making (Pohl, 2004p.321). Sometimes long-term strategies utilized have equivalent performance results as fastdecision making process using rule of thumb but they are all associated with cognitive biasessince human is to error. Mostly quick decision making are beneficial and important. There isnothing to boast about while making decision since we know how we as human are prone toerrors. Although there are situation which can lead to systematic errors which are severe.Mostly entrepreneurs gives a lot of commitments in their startups while leaving other activitiesas well as personal relationships. The startup sounds as a child to an entrepreneur in most cases.Because the pressure of money and time as compared to a child it becomes very difficult to come
up with a compressive decision and strategy. The quality of decision made on startup keepsdiminishing as attitudes increases towards the investment. Entrepreneurs who have been

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