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Part I: Exploration

Part I: Exploration

Figure . Process for Dealing with Risky Situations


A central fact of risk taking is that you do not know the outcome of your decisions before you make them. Risk takers are explorers—they open new territory and take a chance on losing their stake if they fail.

Possible loss is of two kinds: The outcome may leave decision makers worse off than before (a real loss), or the outcome may be less favorable than it might have been (an opportunity loss).

The first steps in this approach to risk taking will make clear where you are starting and where you want to finish. You will take time to clarify your objectives in making the decision, examine the possible decisions you could make, as well as your values regarding them. Lastly, you will assess your personal risk-taking tendencies.

Risk taking is making a choice to gain a desired outcome in the face of potential loss and uncertainty.



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