Sonali Shinde, Milind watve

Models of optimization have played an important role in the fields of evolution as well as economics. In the classical models of optimization, some tend to maximize the ratio of returns to investment and others tend to maximize the net benefit or the difference between the two. Clarity in the contextual appropriateness of the ratio model versus difference model came very recently. This clarity resolves several questions, paradoxes, and apparent fallacies in human social and economic behavior. The human mind might have evolved to carry an innate knowledge about when to use ratio and when to use difference model in decision making.