Question 1

A(n)____ is an informal group allied together for a common purpose.

Accepted Answer

A coalition is a group of individuals or organizations that come together to achieve a common goal or objective. It is an informal alliance that allows different parties to work together towards a specific aim while still retaining their individual status and identity.

Question 2

____ occurs when the decision maker is constrained by his or her own values,experiences,skills,and reflexes.He or she also has less than complete knowledge and information.

Accepted Answer

Bounded rationality occurs when the decision maker has limited information, cognitive abilities, and time. They are forced to make decisions based on incomplete and imperfect information, and their decisions are often biased by personal experiences and preferences. The decision maker must therefore "satisfice," or choose the first acceptable solution that meets the minimum criteria, rather than optimizing or maximizing their decision.

Question 3

____ is the selection of the first minimally acceptable alternative.

Accepted Answer

Satisficing is the selection of the first minimally acceptable alternative. This means that decision-makers choose an option that meets the minimum criteria or threshold rather than trying to find the best possible option.

Question 4

The CEO is retiring.Two candidates for the job remain.Three division heads support Alex.The other four division heads support Pat.These alliances can be called

Accepted Answer

The alliances can be called coalitions as they are formed by groups of people with a common interest or goal, in this case, supporting a particular candidate for the CEO position.

Question 5

The CEO of a company decided to leave Connecticut because the taxes were some of the highest in the country.He limited the search for a new location to Georgia,South Carolina,and North Carolina because taxes are much better there and the cost of living is about 20 percent cheaper.Some employees felt there were more factors to consider.The CEO engaged in

Accepted Answer

The CEO is satisficing, meaning they are making a decision that is "good enough" based on limited options and criteria (in this case, limiting the search to three states based on taxes and cost of living without considering other factors). This is different from optimization, which would involve searching for the absolute best option without limitations.

Question 6

When a manager makes a decision in spite of having imperfect information,this is known as

Accepted Answer

The answer of When a manager makes a decision in...

Question 7

When a manager evaluates alternatives until she comes to one that meets some minimum standard of sufficiency,selects it,and then goes on to other problems without considering the remaining rational alternatives,she has engaged in

Accepted Answer

The behavior described in the question is known as satisficing, where a decision maker chooses the first alternative that meets some minimum standard of sufficiency and stops considering other rational alternatives. This is a result of bounded rationality, where individuals are limited in their ability to process and evaluate all available information before making a decision.

Question 8

The decision that the manager makes using the behavioral model of decision making

Accepted Answer

The behavioral model of decision making acknowledges that managers have imperfect information, limited cognitive ability, and incomplete alternatives. Therefore, they must use bounded rationality and satisficing to make decisions. Therefore, all of the choices are correct.

Question 9

Donald Davis has to decide what pickup trucks to buy for his extermination company employees to drive.There are eight different manufacturers and countless models from which to choose.He stops at a Dodge dealership and selects the full-sized model because he does not have much time to spend shopping and because this truck will do the job.What term Herbert Simon use to describe Davis' decision-making actions?

Accepted Answer

The term used by Herbert Simon to describe Davis' decision-making actions is "satisficing," which means selecting the first option that meets the minimum requirements or goals, rather than spending time to find the optimal or best solution. In this case, Davis selects the full-sized Dodge model because it meets his minimum requirements and he does not have the time or resources to shop around for the best option. Therefore, the best choice is B.

Question 10

A(n)____ decision-making model describes how decisions are made rather than prescribing how they should be made.

Accepted Answer

An administrative decision-making model describes the process of decision-making in organizations as it actually occurs, rather than prescribing an idealized process that should be followed. This approach acknowledges the limitations and bounded rationality that decision-makers face.

Question 11

Entrepreneurs often have a hard time psychologically if they decide to sell the business because it feels like a child they created and helped grow.This is an example of

Accepted Answer

The answer of Entrepreneurs often have a hard time psychologically...

Question 12

Bounded rationality is assumed in

Accepted Answer

Bounded rationality is a central concept in the behavioral approach to decision making, which assumes that humans have cognitive limitations which prevent them from making fully rational decisions. The rational model, on the other hand, assumes that decision makers are fully rational and have access to all necessary information. Decision making under certainty assumes that all outcomes and their probabilities are known with certainty, while bounded rationality implies that decision makers have limited information and cannot consider all possible options. Escalation of commitment is a phenomenon where decision makers continue to invest resources in a failing course of action despite mounting evidence of its failure, which is not directly related to bounded rationality. The nonlinear model is a general term for models that do not follow linear relationships, and is not directly relevant to the concept of bounded rationality.

Question 13

Olga is house hunting in a "hot" market.Some homes sell within hours of listing.Olga finds one that meets her minimum criteria and immediately makes an offer.This is an example of

Accepted Answer

Olga has found a home that meets her minimum criteria and immediately makes an offer, which suggests that she is satisficing - choosing the first option that meets her minimum standards rather than optimizing (finding the best possible option) or engaging in nominal decision making (making a decision based solely on the label or name of the option). Bounded efficiency and equifinality do not apply to this situation.

Question 14

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?

Accepted Answer

Herbert Simon called this phenomenon "bounded rationality," which refers to the idea that people have limited cognitive abilities and resources to make decisions, resulting in an incomplete and imperfect decision-making process. This is because decision makers are influenced by personal biases, heuristics, and cognitive limitations when processing and evaluating information. Therefore, they tend to rely on shortcuts or "rules of thumb" to simplify the decision-making process, which can lead to suboptimal outcomes.

Question 15

____ 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.

Accepted Answer

Bounded rationality refers to the cognitive limitation of individuals to process and analyze all available information when making decisions. Publishers may prioritize books by recognizable celebrities because it is a simpler and quicker decision-making process compared to carefully considering works by unknown authors.

Question 16

Hailey finds that her company is over billing the government for services.She tells her boss,who says he will take care of it,but he does nothing.Hailey tells her government contact.What model of decision making does Hailey's behavior represent?

Accepted Answer

Hailey's behavior represents the Administrative model of decision making, which involves identifying problems and opportunities and resolving them in a practical way. In this case, Hailey identified the problem of overbilling and took action by informing her boss and then the government contact when her boss did not address the issue. This model emphasizes collaboration and practical solutions to common problems.

Question 17

Mario wants to replace his bathroom.He called the contractor who did his kitchen five years ago and hired him.Mario used

Accepted Answer

Mario used satisficing, which involves choosing an option that meets the minimum criteria or is "good enough," rather than seeking the optimal solution. He hired the same contractor because he was satisfied with the previous work, indicating a satisfactory decision rather than an exhaustive search for the best contractor.

Question 18

Which of the following is NOT a behavioral force that influences decision making?

Accepted Answer

Optimization is not a behavioral force that influences decision making; it is a rational approach for decision making that involves maximizing the outcome or the utility. On the other hand, intuition, coalitions, risk propensity, and ethics are all behavioral forces that can influence decision making.

Question 19

Activist investors often try to influence a board to sell off a business unit if it does not have a lot of synergy with other business units.To gain enough influence with the board,these investors usually require

Accepted Answer

Activist investors often work together with other shareholders to form a coalition. This gives them a stronger voice and more influence with the board. Therefore, a coalition is usually required for activist investors to have enough influence to push for a sale of a business unit. Intuition, bounded rationality, interacting group behavior, and escalation of commitment are not necessarily relevant factors in this context.

Question 20

Which of the following statements BEST describes bounded rationality?

Accepted Answer

Bounded rationality is the idea that decision makers are limited in their ability to make fully rational decisions due to factors such as incomplete information, values, unconscious reflexes, skills, and habits. Option A best describes this concept by highlighting these limitations. Options B, C, D, and E either describe decision making without limitations or do not fully capture the concept of bounded rationality.

Quiz 8: Managing Decision Making and Problem Solving

A(n) ____ is an informal group allied together for a common purpose.