Maximization, as the word could suggest, is choosing the best alternative that will lead to the best possible outcome …show more content…
Many economic scholars and researches challenged the question of rationality presented in the Economic Man assumption and developed a new stream in economics known as Behavioral Economics (Fox, 2015). It was discovered by conducting psychological experiments that when making economic decision, people are not always rational (Fox, 2015). New concepts were developed such as heuristics and biases, which prevailed in situations where the data is incomplete or not fully reliable and there is a high degree of uncertainty (Fox, 2015). As was pointed out in our textbook, economic models are very simplified versions of reality and are not able to take into account all nuances (Rittenberg & Tregarthen, 2009). Therefore, making decisions and analyzing economic situation by strictly via the model of Economic man does not always yield correct