A cab was involved in a hit and run accident at night. Two cab companies, the Green and the Blue, operate in the city. 87% of the cabs in the city are Green and 13% are Blue.

A witness identified the cab as Blue. The court tested the reliability of the witness under the same circumstances that existed on the night of the accident and concluded that the witness correctly identified each one of the two colors 82% of the time and failed 18% of the time.

Most subjects estimated the probability at more than 50 percent, some more than 80 percent. Use a Behavioral finances behavioural bias or heuristic to explain these mistakes.