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3.3.2 Availability Heuristics :
The availability heuristic is a phenomenon in which people 
predict the frequency of an event, or a proportion within a 
population, based on how easily an example can be brought to 
mind. There are situations in which people assess the frequency of 
a class or the probability of an event by the ease with which 
instances or occurrences can be brought to mind. E.g., one may 
assess the risk of heart attack among middle-aged people by 
recalling such occurrences among one's acquaintances. Availability 
is a useful clue for assessing frequency or probability. Kahneman 
and Tversy asked participants to judge whether letter ‘K’ would 
appear more frequently at 1
st
place or 3
rd
place in all English 
language words. Many answered 1
st
place. This simply happened 
because you can think of many words that begin with letter ‘K’ than 
that have letter ‘K’ in the third position (Tversky and Kahneman, 
1974). 
Availability Heuristics refers to the strategy of making judgements 
or assess the frequency of a class or the probability of an event on 
the basis of how easily specific type of information can be easily 
brought to mind.
Availability heuristics may lead to errors in decisions and 
judgments. A person argues that cigarette smoking is not unhealthy 
because he knows somebody who smoked three packs of 
cigarettes a day and lived 100 years. That case could simply be an 
unusual case that does not represents health of smokers in 
general.
3.3.3 Anchoring and Adjustment Heuristics : 
 
Anchoring and adjustment is a heuristic that influences the 
way people intuitively assess probabilities. While assessing the 
probability of an event, people start with an implicitly suggested 
reference point (anchor) and make adjustments to it to reach their 
estimate. A person begins with a first approximation (anchor) and 

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then make adjustments to that number based on additional 
information. 
For example, in one of the experiments, Kahneman and 
Tversky asked students to guess the percentage of African nations 
which are members of the United Nations. One group of students 
were first asked "Was it more or less than 45%?" whereas other 
group of students were asked "Was it more or less than 65%?" The 
first group of students guessed lower values than the second 
group. This is because of the use of Anchoring and Adjustment 
heuristics. The initial question set the high (65%) or low (45%) as 
an anchor. Then individuals made adjustment around that anchor 
and gave answers around anchor. So individuals under high anchor 
condition judged the percentage of African nations much higher 
than those who are in low anchor condition. Similar pattern of 
answers have been found for other kinds of estimates. Typically 
impact of adjustments are not sufficient to overcome the effect of 
anchor.
This may be evident in selling and buying of goods. Suppose 
you go for buying in the markets where bargaining is possible. You 
want to buy a ‘Jeans’, then what is the process you follow. The 
shopkeeper tells you a price and you bargain around that price and 
settle for something lower than that. Your bargain is adjusted 
around the anchor (initial price told by shopkeeper).
Anchoring and Adjustment Heuristics refers to the tendency to use 
some value as a initial point and then adjust the final judgment.
So far we have discussed various kinds of heuristics 
explained by Tversky and Kahneman. Availability, 
Representativeness and Anchoring-Adjustment heuristics are 
important biases in judgments and decision making. The recent 
research has shown that there are many other forms of heuristics 
that are used by human beings. They are Affect Heuristics, Fast 
and Frugal Heuristics, etc.