Question 1

The representativeness heuristic occurs when seeming patterns are assumed to represent something that the data warrant.

Accepted Answer

The representativeness heuristic is a mental shortcut that occurs when people categorize something based on how similar it is to a typical case from that category, rather than through a more thorough analysis of the evidence. It's not about assuming patterns from data, but about judging the likelihood of an event by comparing it to an existing prototype in our minds.

Question 2

One effective way to minimize escalation of commitment decision problems is to separate decision choosers from decision evaluators.

Accepted Answer

Separating decision choosers (those who made the initial decision) from decision evaluators (those who assess the outcomes of the decision) can minimize the influence of sunk costs on subsequent decisions and reduce escalation of commitment. This allows for more objective and rational evaluation of the decision.

Question 3

A programmed decision needs to explore alternative solutions because the optimal solution has not yet been identified.

Accepted Answer

Programmed decisions are routine and repetitive, usually involving a set of established guidelines or procedures to follow, and often do not require the exploration of alternative solutions. The identification of the optimal solution is already established. Non-programmed decisions typically require exploring alternative solutions because the optimal solution is not yet clear.

Question 4

The decision process is directed toward changing the root causes of difficulties so that the symptoms are reduced or eliminated.

Accepted Answer

This statement is true. The decision process for problem-solving typically involves identifying the root causes of difficulties and implementing solutions that address those causes, rather than just treating the symptoms of the problem.

Question 5

Research shows that while verdict-based decision making, which employs a broader information search, is much more likely to lead to better decisions, evidence-based decision making is still very common.

Accepted Answer

Evidence-based decision making, which relies on a broader information search and the use of empirical evidence, is generally considered more likely to lead to better decisions compared to verdict-based decision making, which may rely on intuition or less comprehensive information.

Question 6

Research in psychology, management, and political science shows that people regularly make decision errors that are based on discernible emotional states.

Accepted Answer

The answer of Research in psychology, management, and political science...

Question 7

Groupthink is a mode of thinking that people engage in when they are deeply involved in a cohesive in-group, and when the members' striving for agreement override their motivation to realistically appraise alternative courses of action.

Accepted Answer

Groupthink is a real phenomenon, and this statement accurately describes what it is.

Question 8

The availability heuristic operates on the notion that if you can think of something, it must be important and will become part of your decision.

Accepted Answer

The availability heuristic is a cognitive bias that assumes that the more easily people can bring something to mind, the more important it must be. This can lead to overestimating the frequency or likelihood of events based on how easily they come to mind, rather than on objective data.

Question 9

The advantage of scenario thinking is that the importance of one or two key criteria such as the cost of a raw material or the price of a substitute product can be clearly identified and properly dealt with.

Accepted Answer

Scenario thinking allows for the identification of key factors that may impact a business and allows for proper planning to address those factors. This can include identifying the importance of certain criteria, such as cost or price, and developing strategies to address them.

Question 10

The rational decision model is now recognized as insufficient in describing people's behavior under many conditions.

Accepted Answer

In reality, people's behavior is often influenced by emotions, cognitive biases, heuristics, and social and cultural factors, all of which cannot be captured by the rational decision model.

Question 11

The verdict-based approach to information gathering and decision making creates a confirming-evidence bias.

Accepted Answer

The verdict-based approach involves gathering information to confirm a pre-existing decision or belief, leading to a confirming-evidence bias where information that supports the decision is given more weight than information that contradicts it.

Question 12

Satisficing occurs because it is easy to identify all the possible alternatives, and because information about available alternatives is clear.

Accepted Answer

Satisficing occurs when individuals settle for a decision or solution that is good enough, rather than going through the effort of finding the absolute best option. This can be caused by limited time, resources, or information, as well as a desire to avoid the stress of trying to make the perfect choice. Therefore, it is not necessarily true that all possible alternatives are easily identifiable, or that information about alternatives is always clear.

Question 13

A poorly framed problem can undermine even the best-considered decision.

Accepted Answer

A poorly framed problem can lead to inaccurate or incomplete information, making it difficult to make a sound decision. It is important to clearly define the problem and gather all relevant data before making a decision.

Question 14

The impact of bounded rationality is greatest when trying to make programmed decisions, and can be viewed along a continuum of rationality.

Accepted Answer

Bounded rationality has a greater impact on non-programmed decisions, which are complex and require significant judgment, as opposed to programmed decisions that are routine and can often be made using simple rules or procedures.

Question 15

What helps to energize the escalation of commitment problem is the status quo trap, which is the deep-seated bias to make present decisions in order to justify past choices.

Accepted Answer

The answer of What helps to energize the escalation of...

Question 16

One way to overcome groupthink is for the team leader to remember that harmony is the ultimate goal.

Accepted Answer

While harmony may be a desired outcome, it is not the ultimate goal in overcoming groupthink. The ultimate goal is to promote critical thinking and diverse perspectives within the group to make better decisions.

Question 17

In the rational model of decision making, decision makers determine the appropriate decision criteria, such as price and quality, and then assign weights or levels of importance to them.

Accepted Answer

In the rational model of decision making, decision makers do determine the appropriate decision criteria and assign weights or levels of importance to them.

Question 18

According to Herbert Simon, people have the ability to process all of the information and analyze all of the possible solutions to a problem.

Accepted Answer

According to Herbert Simon's theory of bounded rationality, humans have limited cognitive capacity and are unable to process and analyze all possible solutions to a problem. They use heuristics and shortcuts to arrive at satisfactory solutions that meet their needs.

Question 19

Decision support systems are driven by human input that guide people through the decision-making process.

Accepted Answer

Decision support systems are driven by data and models that guide people through the decision-making process.

Question 20

Anchoring occurs when a person is unduly influenced by an initial impression or relies on one piece of information as the key to decision making.

Accepted Answer

Anchoring is a well-documented cognitive bias, where people rely too heavily on the first piece of information they receive and use it as an "anchor" for making decisions. This can lead to systematic errors in judgment or evaluation.

Quiz 9: Decision Making