Final answer:
True, many individuals have difficulties accurately interpreting base rate information due to cognitive biases and a lack of understanding statistical principles.
Step-by-step explanation:
The statement in question is true: when given base rate information, people are often not very good at interpreting it correctly. This can be explained by several cognitive biases and lack of understanding of statistical principles. In many cases, instead of analytically processing statistical information, people may rely on heuristic approaches, which can lead to systematic errors in judgment and decision-making. For instance, individuals might overestimate the significance of specific cases that come to mind rather than considering the statistical likelihood based on base rate data. This can be particularly problematic in surveys where people might not accurately remember information and may answer in a socially desirable manner. Therefore, interpreting base rates is a part of cognitive psychology that touches on how people process quantitative information.