The section outlines an analysis of the irrationality portrayed by people concerning risk policies. People tend to be risk averse with anticipated gain, and the appetite for risk reduces where there is a loss. The human rationality is a limited judgment tool since it lacks consistency in the evaluation of a case at hand. The chapter has outlined Samuelson’s issue which is an intuition that if a person undertakes a similar risk repeatedly, they increase the chances of succeeding. An exaggerated fallacy in planning arises, and an excess of anticipated loss probability forces enables firms to settle a reasonable equilibrium.