Risks

Definition

Risks refer to the potential for harm or loss that an individual may encounter when engaging in certain actions or making decisions. It involves the evaluation of uncertain outcomes and their associated consequences.

Related terms

Heuristics:

Mental shortcuts used by humans to simplify decision-making processes.

Prospect Theory: A theory that suggests people's decisions are influenced by their perception of potential gains or losses rather than objective probabilities.

Availability Heuristic:

A mental shortcut where individuals base their judgments on how easily examples come to mind.