Abstract Original and cumulative prospect theory differ in the composition rule used to combine probability weighting function value function. We test predictive power of these rules by performing a novel out-of-sample prediction test. apply estimates theory’s obtained from two-outcome cash equivalents, domain where original coincide, three-outcome two theories differ. Although both forms predi...

The study aims to investigate the educational progress and prospect theory for teaching pedagogy on aspect of expected learning outcome, instructional activity, assessment in learning. Descriptive quantitative research design is employed because it quantifies measures being formulated prospects principles. Likewise, convenience sampling gathering sample size population study. comprised eighty (...

Casino gambling is a hugely popular activity around the world, but there are still very few models of why people go to casinos or of how they behave when they get there. In this paper, we show that prospect theory can offer a surprisingly rich theory of gambling, one that captures many features of actual gambling behavior. First, we demonstrate that, for a wide range of parameter values, a pros...

An advance in economic thought is in the area of behavioral economics where traditional models of rational decision-making are challenged by newer models of behavior such as Prospect Theory. This is coupled with a world where algorithms have abilities to learn, remember and evolve over time to make better decisions. The advances on these two fronts are forcing the world of markets to be analyze...