This chapter explores the cognitive mechanisms underlying decision-making and judgment. It contrasts expected utility theory, which posits that rational agents maximize expected benefits by weighing outcomes and probabilities, with prospect theory, which reveals how people evaluate gains and losses relative to a reference point, exhibiting loss aversion and nonlinear probability weighting. Real-life examples demonstrate how risk preferences can diverge from rational expectations in scenarios involving gains and losses. The chapter also investigates risk perception and risk-taking behavior, emphasizing how factors such as familiarity, media influence, and individual differences shape our judgment of uncertainty. Social and emotional influences—ranging from peer pressure and cultural norms to specific emotions such as fear and love—have been shown to significantly modulate decision-making processes. Finally, group decision-making and problem-solving are examined, outlining both the benefits of collective input and pitfalls, such as groupthink and polarization. Overall, the chapter integrates insights from cognitive psychology and behavioral economics, providing a nuanced understanding of individual and collective judgment in the digital age.