Deck 4: Managing Decision Making

Question 1

If a manager makes a decision and has a computer program written to embody the decision,the manager is apparently dealing with a programmed decision.

Answer 1

True

Question 2

Programmed decisions are routine decisions that deal with factors that are familiar and have occurred in the past.

Answer 2

True

Question 3

When the bell rings at a firehouse,the firefighters make programmed decisions.

Answer 3

True

Question 4

Inherent in problem recognition is the need to define loosely what the problem is.

Question 5

Citicorp settled a civil lawsuit by the SEC for $75 million,which was less than 3% of its quarterly net income.Citicorp chose to settle,a state of certainty rather than go to trial with a state of uncertainty.

Question 6

Stock markets react more positively to certain bad news,like fines,than to uncertain times of not knowing what will happen.

Question 7

The proper sequence for evaluating a decision alternative is feasibility,satisfactoriness,and probable consequences.

Question 8

Alicia has just realized that her marketing group will not be reaching its sales targets this quarter.With this realization,Alicia is using the "Evaluating Alternatives" step in the rational decision-making process.

Question 9

Evidence-based management recommends facing the hard facts and building a culture in which people are encouraged to tell the truth,but only if it's pleasant.

Question 10

The least common decision making condition is the state of certainty.

Question 11

Choosing between alternatives is risk assessment.

Question 12

Tony Hayward,former CEO of BP,made statements and decisions about vacations during the oil spill that led to him stepping down as CEO.This shows he used the classical decision making model.

Question 13

The steps in the decision-making process outlined in the text are most closely associated with the classical model of decision making.

Question 14

Ryan is trying to hire a new engineer.She has all of the qualifications he wants,with one exception.As a decision alternative,this engineer fails the test of feasibility.

Question 15

One component of problem recognition is defining precisely what the problem is.

Question 16

Zhenfu invested his savings in a bank certificate of deposit because that is where he has always put his savings,and because he is very concerned about the safety of his investment.Zhenfu knows at the end of two years he will have $52,546.73.He is operating under the decision-making condition known as risk.

Question 17

The ability to assign probability estimates to the various outcomes in a decision-making situation is associated with the decision-making condition known as risk.

Question 18

Iftikhar is trying to decide where to invest company funds and has determined that there are only four options open to him that will provide a guaranteed return on the funds.He is operating under the decision-making condition known as certainty.

Question 19

Decision making can refer to either a specific act or a general process.

Question 20

A plant manager notices that overtime seems to be excessive.This will stimulate a decision.

Question 21

The process of choosing one alternative from among many alternatives is called

A)satisficing.
B)problem solving.
C)bounded rationality.
D)decision making.
E)None of these.

Question 22

Individual ethics are personal beliefs about right and wrong behavior.

Question 23

When Canine Companions for Independence trainers train a dog to be a service dog they start from a basic training approach.Dogs communicate through body language that the trainer knows.The trainer routinely makes ____ decisions.

A)programmed
B)satisficing
C)nonprogrammed
D)irrational
E)rational

Question 24

For a major project for his employer,Jason wants to choose the management consulting team that will give his employer the best outcome.Which decision criteria should Jason use to maximize effectiveness?

A)He should choose the team with the lowest expenses.
B)He should choose the team that can complete the project the quickest.
C)He should choose the team that has the most knowledge and experience.
D)Can't decide¾None of these criteria are likely to lead to effectiveness.
E)Can't decide¾Jason needs to know which criteria are most important to his employer.

Question 25

As it relates to decision making,the term best alternative implies decision accuracy and efficiency.

Question 26

The best alternative is the most ____ alternative.

A)efficient
B)controllable
C)profitable
D)effective
E)valid

Question 27

People who work in ethical organizations do not face ethical decision.

Question 28

The senior pastor at Princeton Alliance Church needs to select a pastor of adult ministry.This is an example of

A)decision making under uncertainty.
B)decision making under risk.
C)decision making under absolute certainty.
D)decision making under unrealistic conditions.
E)None of these.

Question 29

At least one member of a group or team should be assigned the role of devil's advocate.

Question 30

The most common methods of group and team decision making are interacting groups,Delphi groups,and nominal groups.Increasingly,these methods of group decision making are being conducted online.

Question 31

The administrative model of decision making describes how decisions are actually made as opposed to prescribing how they should be made.

Question 32

According to the administrative model of decision making,managerial intuition is equivalent to random guesswork.

Question 33

Bar code scanning computers at checkout have greatly simplified the inventory ____ decisions.

A)nonprogrammed
B)certainty
C)risk
D)programmed
E)need

Question 34

"Decision making under risk" means the decision maker

A)has no data on which to base his or her decision.
B)is risk-averse,avoiding risky investments.
C)knows all the risks involved in the decision.
D)can estimate decision data with some probability.
E)is making an important decision with long- term consequences.

Question 35

A Delphi group is a consensus of expert opinion.

Question 36

The term satisficing refers to the idea that people's rationality has limits.

Question 37

American,Robert Dudley,became CEO of BP during the huge task of cleaning up the oil spill and rebuilding trust after safety concerns became obvious.Regarding his career,Dudley has high risk propensity.

Question 38

Yum Brands is expanding its Chinese presence into smaller cities like Yiyang and Zhengzhou because larger cities are saturated.This is an example of a(n)____ decision.

A)programmed
B)nonprogrammed
C)satisficing
D)rational
E)irrational

Question 39

Rahda offered to buy a home.Her realtor told her there is an 80% chance her offer price will be accepted.She is operating in a

A)state of risk.
B)state of uncertainty.
C)state of certainty.
D)state of bounded rationality.
E)state of satisficing.

Question 40

When a student chooses to study instead of going out with friends,he is engaged in

A)problem solving.
B)decision framing.
C)decision making.
D)brainstorming.
E)satisficing.

Question 41

When the price of oil came down,demand for full size SUVs increased.Automakers make more profit on large vehicles than small vehicles.Automakers chose to increase production of full size SUVs.The increase in production was which step in the rational decision making model?

A)Develop a set of rational alternatives
B)Evaluate the possible alternatives
C)Implement the chosen alternative
D)Recognize and define the decision situation
E)Evaluate decision effectiveness

Question 42

Joyce wants to decrease turnover.She can change hiring practices,increase benefits,increase wages,or provide a yearend bonus.She chooses the yearend bonus because it keeps payroll lower and should quickly affect turnover.Joyce is in which step in the decision-making process?

A)Selecting which alternative to implement
B)Identifying alternatives
C)Defining the decision situation
D)Evaluating alternatives
E)Developing a set of alternatives

Question 43

In the classical decision making model,"optimization" means

A)implementing two or more alternatives simultaneously.
B)choosing the alternative with the best overall expected outcomes.
C)gathering the most complete information before making the decision.
D)reaching a satisfactory level of performance.
E)None of these.

Question 44

When a plant manager who is trying to reduce turnover of production workers notices that turnover has decreased by 10 percent four months after he instituted a new training program,at which step in the rational decision-making process is this manager?

A)Evaluating the results
B)Identifying alternatives
C)Recognizing the decision situation
D)Selecting the best alternative
E)Developing a set of alternatives

Question 45

Amazon,maker of Kindle,could choose a touch screen which increases glare or non-touch screen for better viewing.They were in which step of the rational decision making model?

A)Develop a set of rational alternatives
B)Evaluate the possible alternatives
C)Consult with other decision-makers
D)Recognize and define the decision situation
E)Evaluate decision effectiveness

Question 46

Which of the following decision-making models is based on the belief that human behavior is often imperfect?

A)Rational
B)Emotional
C)Classical
D)Behavioral
E)Sequential

Question 47

Tim knows he deserves a raise.He talks with HR about his outstanding performance.HR describes what a bad year the company is having and that there is no money for raises.Tim's raise failed the test for ____.

A)consequences
B)bounded rationality
C)satisficing
D)escalation of commitment
E)feasibility

Question 48

Citicorp chose to settle an SEC lawsuit for $75 million.When executives compare the cost of the settlement to those of other financial institutions they are in which step of the rational decision making model?

A)Develop a set of rational alternatives
B)Evaluate the possible alternatives
C)Consult with other decision-makers
D)Recognize and define the decision situation
E)Follow up and evaluate the results

Question 49

The administrative model of decision making assumes that managers are imperfect.This means that managers

A)are stupid.
B)lack training and education.
C)suffer from human biases.
D)don't care about decision outcomes.
E)fail to understand the decision making process.

Question 50

Oprah Winfrey and Regis Philbin retired from daytime talk shows about the same time.Television executives saw an opportunity to fill the void.The show Anderson launched before Regis left but after Oprah stopped.The executives were in which step of the rational decision-making process?

A)Develop a set of rational alternatives
B)Evaluate the possible alternatives
C)Select the alternative
D)Implementing an alternative
E)Evaluate decision effectiveness

Question 51

Will has a stack of resumes.He throws out all the ones without a masters degree.Which criterion for evaluating a decision alternative do these candidates fail to meet?

A)Consequences
B)Bounded rationality
C)Satisficing
D)Satisfactoriness
E)Feasibility

Question 52

Which of the following is a true statement?

A)The classical model of decision making is a prescriptive model.
B)The administrative model of decision making is a descriptive model.
C)The classical model focuses on the real world,while the administrative model shows us the ideal world.
D)All of these.
E)None of these.

Question 53

Tim thinks he deserves a promotion.He talks with HR about his outstanding performance.HR knows that Tim's performance is only a little better than the others and if Tim gets promoted other directors will ask for promotion to VP.They will be turned down and the long term affect will be several disgruntled managers.Tim's promotion failed the test for ____.

A)consequences
B)satisfactoriness
C)satisficing
D)escalation of commitment
E)feasibility

Question 54

According to the concept of bounded rationality,decision makers are limited by

A)less than complete information.
B)their values.
C)their habits.
D)limited time.
E)All of these.

Question 55

Which of the following decision-making models is a prescriptive model?

A)Behavioral
B)Classical
C)Administrative
D)Bureaucratic
E)Probabilistic

Question 56

Who was one of the first experts to develop the administrative model of decision making?

A)Elton Mayo
B)George Bennett
C)Martin Johnson
D)Jack Welch
E)Herbert Simon

Question 57

During the recession many Americans lost their jobs.They could spend less,spend savings,or continue their lifestyle by using credit.They were in which step of the rational decision making model?

A)Develop a set of rational alternatives
B)Evaluate the possible alternatives
C)Identify alternatives
D)Recognize and define the decision situation
E)Evaluate decision effectiveness

Question 58

Bounded rationality is assumed in

A)the behavioral model.
B)the rational model.
C)the irrational model.
D)decision making under certainty.
E)None of these.

Question 59

Herbert Simon noted that managers generally fail to make rational decisions because they are limited by their own values,skills,habits,and unconscious reflexes as well as by incomplete information.What name did Simon give this phenomenon?

A)Satisficing
B)Bounded rationality
C)Brainstorming
D)Rational decision making
E)Decision framing

Question 60

Oprah Winfrey and Regis Philbin retired from daytime talk shows about the same time.Television executives saw an opportunity to fill the void.The executives were in which step of the rational decision-making process?

A)Develop a set of rational alternatives
B)Evaluate the possible alternatives
C)Consult with other decision-makers
D)Recognize and define the decision situation
E)Evaluate decision effectiveness

Question 61

Eric is communications director.The New York Times wants to interview his boss.Eric suspects the reporter is not objective,so he declines the interview.Eric used ____ to make the decision.

A)intuition
B)escalation of commitment
C)bounded rationality
D)programmed decision
E)coalitions

Question 62

Which of the following is the most common form of a decision-making group?

A)Interacting
B)Delphi
C)Nominal
D)Reactive
E)Interdependent

Question 63

For his work in developing the administrative model to describe how managers make decisions in the real world,Herbert Simon won the Nobel Prize in

A)medicine.
B)economics.
C)peace.
D)psychology.
E)management.

Question 64

Which of the following disadvantages of group decisions typically results from the group being very cohesive?

A)Irrationality
B)Groupthink
C)Compromise
D)Dominance
E)Coalitions

Question 65

Diaz Nesamoney is a computer scientist who founded three successful software companies.Entrepreneurs tend to have a high

A)bounded optimization.
B)escalation of commitment.
C)risk propensity.
D)strategic maximization.
E)intuitive rationality.

Question 66

A disadvantage of using interacting groups to make decisions is

A)group politics.
B)a void of expert opinion.
C)an increase in programmed costs.
D)faster decision making.
E)too much brainstorming.

Question 67

Which of the following is a disadvantage of group decision making?

A)More alternatives are likely to be generated.
B)More information will be brought to bear on the problem.
C)More time will be needed to make the decision.
D)More communication about the decision will result.
E)All of these.

Question 68

Ryan Tool Company just purchased Coney Tools.The purchase came about because both the research and development people and the production people at Ryan joined forces to lobby for the purchase of Coney rather than another company.Both groups wanted Coney because of its up-to-date research and production facilities.The behavioral force that influenced their decision making is referred to as ____.

A)political
B)intuitive
C)escalating commitment
D)rational
E)a coalition

Question 69

William invested in an initial public offering.After a month he lost 5 percent.After a year he lost 50 percent.After two years he lost 80 percent.William's decision to keep the investment is an example of ____.

A)political forces
B)intuition
C)escalation of commitment
D)rationality
E)satisficing

Question 70

All of the following are advantages of group decision making EXCEPT

A)groupthink may occur.
B)better decisions generally emerge.
C)enhanced communication may result.
D)more information and knowledge are available.
E)None of these.

Question 71

Tony Hayward,former CEO of BP,made statements and decisions about vacations during the oil spill that led to him stepping down as CEO.His innate belief without conscious consideration that attending a polo match during the crises was ok shows he used

A)escalation of commitment.
B)classical decision making.
C)satisficing.
D)means-end inversion.
E)bad intuition.

Question 72

After BP failed repeatedly to stop the oil spill,it gathered engineers from around the world to help find a solution.This was a(n)____ group.

A)Delphi
B)interacting
C)nominal
D)unilateral
E)task

Question 73

When a marketing manager decides to launch a new product because it was the first product he investigated that showed profits over the minimum required threshold,what type of decision process is this manager using?

A)Escalation of commitment
B)Intuition
C)Bounded rationality
D)Satisficing
E)None of these.

Question 74

Which of the following types of groups is sometimes used to develop a consensus of expert opinion by getting a group of experts together to generate and then discuss alternatives?

A)Interacting
B)Delphi
C)Detached
D)Rational
E)Nominal

Question 75

If you were asked to help a manager establish a nominal group,which of the following would you recommend?

A)Alternatives are listed on a flip chart.
B)The alternative with the most votes is the solution.
C)Members are permitted to ask questions only for clarification.
D)All of these.
E)Only "alternatives are listed on a flip chart" and "The alternative with the most votes is the solution."

Question 76

When people are asked "if you fold a piece of paper 50 times,how high will it be?" they tend,at best,to say a tall building.In reality it would reach to the sun.Human decisions are limited by ____.

A)bounded rationality
B)escalation of commitment
C)satisficing
D)coalition
E)political forces

Question 77

Which of the following is NOT an example of an interacting group?

A)Standing committee
B)Delphi group
C)Task force
D)Functional department
E)Ad hoc committee

Question 78

One advantage of group decision making is

A)groupthink.
B)compromise.
C)diversity of members' backgrounds.
D)lowered cost of decision making.
E)ability of a strong individual to direct the group.

Question 79

Keisha is Vice President of accounting,and she has to decide which computer software to purchase for her department.She has looked at all of the possible alternatives and is leaning toward the system with which she is most familiar.This is an example of

A)optimization.
B)bounded rationality.
C)satisficing.
D)synergy.
E)escalation of commitment.

Question 80

____ may explain why publishers are more likely to publish a children's book by a recognizable celebrity like Katie Couric than to consider a beautifully illustrated and written book by an unknown author.

A)Bounded rationality
B)Irrational decision making
C)Optimization
D)Feasibility
E)Means-end inversion