Intolerance of uncertainty is a behavioral effect that often motivates managers to:
A) Invest heavily in strategic-related investments.
B) Choose projects with short payback periods.
C) Invest in a few large, sequential investments.
D) Invest in projects with relatively long payback periods.
E) Favor projects that are mutually exclusive.

Question

Quizplus · Accepted Answer

Intolerance of uncertainty refers to a manager's discomfort with ambiguity and unpredictability. Managers who suffer from this condition tend to prefer projects with shorter payback periods that offer more immediate returns and reduce uncertainty. This allows them to make faster decisions and move on to the next project or investment opportunity. Therefore, choice B - choosing projects with short payback periods - is the best option for managers with intolerance of uncertainty.

Intolerance of Uncertainty Is a Behavioral Effect That Often Motivates