7 questions. Test what you've absorbed — then apply it to a real decision you're facing right now.
Question 1 of 7Score: 0 / 5
Question 1 — Knowledge
Kahneman's research identified two systems of thinking. Which statement best describes the difference between System 1 and System 2?
ASystem 1 is rational and deliberate; System 2 is fast and intuitive
BSystem 1 is fast, automatic and emotional; System 2 is slow, deliberate and effortful
CSystem 1 handles complex decisions; System 2 handles simple ones
DSystem 1 and System 2 work independently and never interact
✓ Exactly right. System 1 is fast, automatic, emotional, and largely unconscious — it handles most of what we do every day. System 2 is slow, deliberate, and effortful — it's what we call on for complex analysis. The problem is that System 1 is running most of our significant decisions while we believe System 2 is in charge.
System 1 is fast, automatic and emotional — it runs most of our decisions unconsciously. System 2 is slow and deliberate — but it's effortful and easily overridden by System 1. Kahneman's central finding: we think we're using System 2 for important decisions far more often than we actually are.
Question 2 — Knowledge
What is confirmation bias, and why is it particularly dangerous for founders and entrepreneurs?
AThe tendency to make decisions too quickly without enough information
BThe tendency to seek, interpret and remember information that confirms what we already believe — while ignoring contradictory evidence
CThe tendency to follow the crowd when making decisions under uncertainty
DThe tendency to overweight recent events when predicting the future
✓ Right. Confirmation bias means we unconsciously seek evidence that supports what we already believe and discount evidence that challenges it. For founders, this is devastating: you believe in your idea (you have to, to build it), which means you are systematically more likely to see the evidence that confirms it and explain away the evidence that doesn't.
Confirmation bias is the tendency to seek, interpret and remember information that confirms existing beliefs — while filtering out contradictory evidence. For founders, the danger is that conviction (which is necessary) becomes a filter that stops you seeing what the market is actually telling you. The belief that makes you start also makes you miss the signals that you need to change.
Question 3 — Knowledge
Kahneman and Tversky's Prospect Theory found that losses are experienced as approximately how much more painful than equivalent gains are pleasurable?
AThe same — gains and losses feel equally intense
B1.5 times more painful
CTwice as painful
DThree times as painful
✓ Exactly. Losses are experienced as approximately twice as painful as equivalent gains are pleasurable. This is why people hold losing investments too long (to avoid realising the loss), why founders persist with failing ideas (the pain of quitting exceeds the pain of continuing), and why 'don't lose what you have' is a more powerful motivator than 'gain something new.'
The answer is twice as painful. Kahneman and Tversky's Prospect Theory found losses are experienced at approximately 2× the intensity of equivalent gains. This explains why people make irrational decisions to avoid losses — including holding on to failing ventures, bad investments, or wrong hires far longer than the evidence justifies.
Question 4 — Knowledge
What is the 'sunk cost fallacy' and what is the correct way to think about sunk costs when making decisions?
ASunk costs are future costs that should always be included in decisions
BSunk costs are past costs that cannot be recovered — and should be ignored when making forward-looking decisions
CSunk costs should always be recovered before a project is abandoned
DSunk costs are only relevant in financial decisions, not personal ones
✓ Right. Sunk costs are past costs that cannot be recovered — and rationally should have zero influence on forward-looking decisions. The only question is: given where I am now, what is the best path forward? But loss aversion makes us feel that abandoning a project means the past investment was wasted. It wasn't — it's gone regardless of what you do next.
Sunk costs are past costs that cannot be recovered — they are gone whether you continue or stop. The rational approach: ignore them entirely when making forward-looking decisions. The only question is 'from here, what is the best path forward?' But most people continue failing projects, bad hires, and wrong strategies because of what they've already invested — compounding a mistake rather than cutting it.
Question 5 — Application
You've been working on a product idea for Moon Rescue for three months. Early feedback from five potential customers has been lukewarm — interested but not excited. You've invested significant time and some money. What does good decision making look like here?
AContinue because you've already invested three months — stopping now would waste everything
BStop immediately — lukewarm feedback always means a bad idea
CSeparate the sunk cost (three months already spent) from the forward decision — ask what the lukewarm feedback is actually telling you about the idea, and decide based on that signal, not the time already invested
DGet more feedback from more people before deciding anything
✓ Exactly right. The three months is a sunk cost — it's gone regardless of what you decide next. The question is: what is the lukewarm feedback actually telling you? Is it the wrong audience? The wrong framing? A real problem with the idea? That signal — not the time already invested — is what should drive the next decision. Sometimes the answer is pivot; sometimes it's persist; the sunk cost tells you nothing about which.
Option C is the correct framing. The three months already spent is a sunk cost — it cannot be recovered and should not influence what you do next. The forward question is: what does the lukewarm feedback actually tell you about the idea? Is it the wrong customer? The wrong problem framing? Something genuinely wrong with the concept? Answer that question based on the evidence, not the investment already made.
Question 6 — Reflection
Think about a decision you're currently facing — in your business, career, or life. Which cognitive bias from this book do you think is most likely affecting how you're thinking about it?
Name the decision, name the bias, and describe how it might be distorting your thinking. Be honest — the value is in the recognition, not the answer.
Question 7 — Commitment
Using what you've learned this week, what is one decision you've been avoiding or overcomplaining that you will make — clearly and finally — in the next 48 hours?
Not a big life decision. A specific, actionable decision for Moon Rescue or your week ahead. Write it as a commitment: "I will decide [X] by [when] by doing [what]."
0out of 5
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One thing. Right now.
Go back to what you wrote in Question 7. You made a commitment. The decision you identified, the timeline you set, the action you said you'd take.
The research is clear: people who write down a specific decision with a specific deadline are significantly more likely to actually make it. You just did that.
Now honour it.
Paste this into Briefing AI
"I just completed the Decision Making quiz. The decision I identified in Question 7 is: [paste your answer]. Help me think through this decision clearly — what information do I actually need, what biases might be affecting me, and what would a good decision process look like here?"