what are the main components of prospect theory 
prospect theory is part of the behavioral economic subgroup it describes how individuals make decisions between alternatives where risk is involved and the probability of different outcomes is unknown there is a certainty effect exhibited in the prospect theory where people seek certain outcomes underweighting only probable outcomes who proposed prospect theory prospect theory was first introduced in 1979 by amos tversky and daniel kahneman who later developed the idea in 1992 the pair said that the prospect theory was better at accurately describing how decisions are made compared to the expected utility theory 