Test Bank | Chapter 4 Making Decisions – 11e

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Fundamentals of Management, 11e (Robbins)

Chapter 4 Making Decisions

1) Decision making begins with ________.

A) selecting alternatives

B) identifying decision criteria

C) identifying a problem

D) eliminating false alternatives

Diff: 2

AACSB: Analytical thinking

LO: 4.1: Describe the decision-making process.

Question Category: Concept

2) Which one of the following defines a problem in the decision-making process?

A) a discrepancy between what exists and what the decision maker desires to exist

B) a discrepancy between the ideal and the practical

C) something that causes irritation

D) something that calls for attention

Diff: 1

AACSB: Analytical thinking

LO: 4.1: Describe the decision-making process.

Question Category: Concept

3) The decision-making process consists of a series of eight steps that identify a problem and work toward ultimately ________.

A) determining if there is a solution to the problem

B) solving the problem

C) making a plan to solve the problem

D) breaking down the problem into a series of steps

Diff: 1

AACSB: Analytical thinking

LO: 4.1: Describe the decision-making process.

Question Category: Concept

4) To identify a problem, a manager ________.

A) compares one set of standards or goals to a second set of standards or goals

B) looks for unhappy customers

C) uses intuition to see that things don't look right

D) compares the current state of affairs with some standard or goal

Diff: 1

AACSB: Analytical thinking

LO: 4.1: Describe the decision-making process.

Question Category: Concept

5) A manager can faithfully execute the decision-making process but still end up with nothing of value if ________.

A) he fails to identify the correct problem

B) he fails to assign number values to different criteria

C) he solves the problem inefficiently

D) he fails to correctly identify the steps of the process

Diff: 2

AACSB: Application of knowledge

LO: 4.1: Describe the decision-making process.

Question Category: Concept

6) A manager is considering purchasing new computers for her department. The manager spends time assessing the computers her department now has. Which stage of the decision-making process is she going through?

A) identification of a problem

B) identification of decision criteria

C) development of alternatives

D) implementation of an alternative

Diff: 2

AACSB: Application of knowledge

LO: 4.1: Describe the decision-making process.

Question Category: Application

7) A manager is determining what kind of new computers she should purchase for her department. She has made a list of five different computer models for consideration. Which stage of the decision-making process is this?

A) selection of an alternative

B) identification of decision criteria

C) development of alternatives

D) analysis of alternatives

Diff: 2

AACSB: Application of knowledge

LO: 4.1: Describe the decision-making process.

Question Category: Application

8) After purchasing new computers for her department, a manager is now comparing the performance of the new computers to the computers they replaced. Which stage of the decision-making process is she carrying out?

A) analysis of alternatives

B) evaluation of decision effectiveness

C) selection of an alternative

D) implementation of an alternative

Diff: 2

AACSB: Application of knowledge

LO: 4.1: Describe the decision-making process.

Question Category: Application

9) For a high-tech bicycle buyer, decision criteria would be determined by ________.

A) whatever most bike buyers recommend

B) expert ratings in bike magazines

C) technical specifications

D) personal preferences of the buyer

Diff: 2

AACSB: Application of knowledge

LO: 4.1: Describe the decision-making process.

Question Category: Application

10) Which one of the following is LEAST likely to be a decision criterion for a high-tech bicycle buyer who cares primarily about performance?

A) warranty

B) gear mechanism

C) frame composition

D) brake assembly

Diff: 2

AACSB: Application of knowledge

LO: 4.1: Describe the decision-making process.

Question Category: Application

11) Which one of the following would be a fairly objective criterion by which a bicycle buyer could assess different bike models?

A) color

B) weight

C) quality of craftsmanship

D) style

Diff: 2

AACSB: Analytical thinking

LO: 4.1: Describe the decision-making process.

Question Category: Analytical

12) A manager chooses to ignore a rigorous decision-making process and selects TV monitor A over monitor B because he "trusts" company A more than company B. If the decision he made was rational, which one of the following is true?

A) Monitor A is really the better choice.

B) The manager should have included "trust" as a criterion.

C) Monitor B is really the better choice.

D) The manager must have made a mistake in calculating his weighted criteria.

Diff: 3

AACSB: Analytical thinking

LO: 4.1: Describe the decision-making process.

Question Category: Analytical

13) In allocating weights to the decision criteria, which one of the following is most helpful to remember?

A) All weights must be the same.

B) The total of the weights must equal 100.

C) The high score should be a 10, and no two criteria should be assigned the same weight.

D) Assign the most important criterion a score, and then assign weights against that standard.

Diff: 3

AACSB: Analytical thinking

LO: 4.1: Describe the decision-making process.

Question Category: Analytical

14) What is a heuristic?

A) a complicated and systematic method of decision making

B) a purely intuitive method of decision making

C) a totally unreliable method of decision making

D) a shortcut or rule of thumb that is used for decision making

Diff: 2

AACSB: Analytical thinking

LO: 4.1: Describe the decision-making process.

Question Category: Concept

15) Because they are not systematic or comprehensive, using heuristics in place of an eight-step decision-making process can lead to ________.

A) errors and biases

B) consistently better decisions

C) more imaginative decisions

D) decisions that more directly solve problems

Diff: 2

AACSB: Analytical thinking

LO: 4.1: Describe the decision-making process.

Question Category: Concept

16) Which one of the following is NOT a reason why managers often resort to using heuristics?

A) They seem to eliminate complexity.

B) They seem to eliminate ambiguity.

C) They save time.

D) They thoroughly explore all alternatives.

Diff: 2

AACSB: Analytical thinking

LO: 4.1: Describe the decision-making process.

Question Category: Concept

17) A banker opts for short-term gain despite indications that his decision might not pay off in the long run. Which error or bias is the banker guilty of?

A) overconfidence

B) immediate gratification

C) selective perception bias

D) representation

Diff: 2

AACSB: Application of knowledge

LO: 4.1: Describe the decision-making process.

Question Category: Application

18) A scientist cites two studies that show a positive effect for her drug and ignores five other studies that show a negative effect. Which error or bias is she committing?

A) hindsight

B) anchoring effect

C) confirmation bias

D) self-serving

Diff: 2

AACSB: Application of knowledge

LO: 4.1: Describe the decision-making process.

Question Category: Application

19) One legislator sees decreased tax revenue as the key problem in the budget. A second legislator sees increased spending as the problem. Each of these legislators has a(n) ________.

A) representation bias

B) self-serving bias

C) availability bias

D) framing bias

Diff: 2

AACSB: Application of knowledge

LO: 4.1: Describe the decision-making process.

Question Category: Application

20) Which one of the following is NOT a common decision-making error or bias?

A) sunk costs

B) randomness

C) forest for the trees

D) overconfidence bias

Diff: 2

AACSB: Analytical thinking

LO: 4.1: Describe the decision-making process.

Question Category: Concept

Decisions, Decisions (Scenario)

Sondra needed help. Her insurance company's rapid growth was necessitating making some IT changes, but what changes? Should they modify the servers that they currently use or purchase an entirely new system? Sondra was confused and needed help in making the correct decision.

21) According to the decision-making process, the first step Sondra should take is to ________.

A) analyze alternative solutions

B) identify decision criteria

C) evaluate her decision's effectiveness

D) identify the problem

Diff: 1

AACSB: Application of knowledge

LO: 4.1: Describe the decision-making process.

Question Category: Application

22) Sondra has decided to collect information about the features the company needs for its system. Which stage of the decision-making process is she carrying out?

A) identify alternative solutions

B) identify decision criteria

C) evaluate her decision's effectiveness

D) allocate weights to the criteria

Diff: 2

AACSB: Application of knowledge

LO: 4.1: Describe the decision-making process.

Question Category: Application

23) Sondra has determined that the speed of the system she settles on is twice as important as the capacity of the system. Which stage of the decision-making process is she carrying out?

A) allocation of weights to criteria

B) selecting an alternative

C) implementing the alternative

D) identifying the problem

Diff: 2

AACSB: Analytical thinking

LO: 4.1: Describe the decision-making process.

Question Category: Application

24) Sondra has decided to purchase a new system. After obtaining permission, she has ordered the system from a reputable company. Which stage of the decision-making process is she carrying out in making the order?

A) analyzing alternative solutions

B) selecting an alternative

C) implementing the alternative

D) identifying the problem

Diff: 3

AACSB: Application of knowledge

LO: 4.1: Describe the decision-making process.

Question Category: Application

25) The very last step Sondra should take, according to the decision-making process, is to ________.

A) analyze alternative solutions

B) select alternatives

C) implement the alternative

D) evaluate the decision's effectiveness

Diff: 1

AACSB: Analytical thinking

LO: 4.1: Describe the decision-making process.

Question Category: Analytical

26) In decision making, a problem can be defined as a discrepancy between what exists and what the problem solver desires to exist.

Diff: 2

AACSB: Analytical thinking

LO: 4.1: Describe the decision-making process.

Question Category: Concept

27) A decision criterion defines factors that are relevant in a decision.

Diff: 2

AACSB: Analytical thinking

LO: 4.1: Describe the decision-making process.

Question Category: Concept

28) Managers identify a problem by comparing the current state of affairs to some standard.

Diff: 3

AACSB: Analytical thinking

LO: 4.1: Describe the decision-making process.

Question Category: Concept

29) All criteria are equally important in the decision-making process.

Diff: 2

AACSB: Analytical thinking

LO: 4.1: Describe the decision-making process.

Question Category: Analytical

30) Identifying the wrong problem is just as much a failure for a manager as identifying the right problem and failing to solve it.

Diff: 2

AACSB: Analytical thinking

LO: 4.1: Describe the decision-making process.

Question Category: Analytical

31) The final step of the decision-making process is to implement the alternative that has been selected.

Diff: 1

AACSB: Analytical thinking

LO: 4.1: Describe the decision-making process.

Question Category: Analytical

32) A heuristic can simplify the decision-making process.

Diff: 1

AACSB: Analytical thinking

LO: 4.1: Describe the decision-making process.

Question Category: Analytical

33) Because heuristics simplify the decision-making process, they are unlikely to lead to errors.

Diff: 1

AACSB: Analytical thinking

LO: 4.1: Describe the decision-making process.

Question Category: Analytical

34) Decision makers who seek information that matches what they already know are guilty of confirmation bias.

Diff: 1

AACSB: Analytical thinking

LO: 4.1: Describe the decision-making process.

Question Category: Concept

35) A basketball coach who takes a very good shooter out of a game because she missed her last two shots has availability bias.

Diff: 1

AACSB: Application of knowledge

LO: 4.1: Describe the decision-making process.

Question Category: Application

36) In a short essay, list and discuss the first four steps in the decision-making process. Give an example of each step.

The decision-making process begins with a discrepancy between an existing and a desired state of affairs. An example of identifying a problem is choosing a new car.

Step 2: Identification of decision criteria

Once the manager has identified a problem that needs attention, the decision criteria important to resolving the problem must be identified. That is, managers must determine what factors are relevant in making a decision. An example of identifying decision criteria is deciding what features you need in a new car.

Step 3: Allocation of weights to the criteria

At this step, the decision maker must compare the items in order to give them the correct priority in the decision. The most important criterion is assigned the heaviest weight. Other criteria are assigned weights in comparison with that standard. Weights can be quantitative—with number values—or determined on a qualitative scale. An example of weighting decision criteria is ranking the features of a new car in order of their importance.

Step 4: Development of alternatives

The fourth step requires the decision maker to use the criteria to develop a list of possible alternatives that may solve the problem. An example of developing alternatives is making a list of possible new cars.

Diff: 2

AACSB: Application of knowledge

LO: 4.1: Describe the decision-making process.

Question Category: Application

37) In a short essay, list and discuss the final four steps in the decision-making process. Give an example of each step.

Once the alternatives have been identified, the decision maker must critically analyze each alternative. From this comparison, the strengths and weaknesses of each alternative become evident. An example of analyzing alternatives is to make a table of weighted scores for possible new cars.

Step 6: Selection of an alternative

The sixth step is the important act of choosing the best alternative from among those considered. All the pertinent factors should be considered here, both objective and subjective. Then a choice of a single alternative—or group of alternatives—should be selected. An example of selecting an alternative is to choose a single new car from a list of alternatives.

Step 7: Implementation of the alternative

Implementation involves carrying out the decision that was made. In the car example, it involves purchasing the car that was selected.

Step 8: Evaluation of decision effectiveness

The last step in the decision-making process involves appraising the outcome of the decision to see if the problem has been resolved. Did the alternative chosen and implemented accomplish the desired result? If not, the decision maker may consider returning to a previous step or may even consider starting the whole decision process over. An example of this final step would be to assess the success of the car-buying decision. Was the right car selected? Did it have all of the features and characteristics that were needed? Did it perform all of the functions that were needed?

Diff: 2

AACSB: Application of knowledge

LO: 4.1: Describe the decision-making process.

Question Category: Application

38) The three main models that managers use to make decisions are ________.

A) rational, bounded rational, and intuitive

B) rational, irrational, and bounded rational

C) intuitive, unintuitive, and rational

D) bounded rational, intuitive, and systematic

Diff: 1

AACSB: Analytical thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Concept

39) It is assumed that a rational decision maker ________.

A) would never make a wrong choice

B) would be subjective and impractical

C) would face only difficult decisions

D) would be objective and logical

Diff: 2

AACSB: Analytical thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Concept

40) What does it mean for a decision maker to maximize value?

A) to make the decision to be as clear and logical as possible

B) to make the achievement of goals as likely as possible

C) to waste as little time and energy as possible

D) to make decision making as simple as possible

Diff: 2

AACSB: Analytical thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Concept

41) Maximizing value for an organization means making sure that ________.

A) the organization makes money

B) the best interests of the organization are addressed

C) the decision made is as rational as possible

D) the decision is as simple as possible

Diff: 3

AACSB: Analytical thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Concept

42) Which one of the following is NOT assumed in a rational decision?

A) a clear and specific goal

B) a clear and unambiguous problem

C) most alternatives and consequences are known

D) value is maximized

Diff: 2

AACSB: Analytical thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Concept

43) It is assumed that in most cases the decisions of all managers are limited by ________.

A) greed and short-sightedness

B) having too much information

C) not being able to analyze all information for all alternatives

D) not being able to act rationally or in the best interests of their organization

Diff: 2

AACSB: Analytical thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Concept

44) Which term best characterizes a decision that has bounded rationality?

A) virtually perfect

B) rigorous and comprehensive

C) not good enough

D) just good enough

Diff: 2

AACSB: Analytical thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Concept

45) Software programs that use a series of questions to aid humans in decision making are called ________.

A) text reading software

B) expert systems

C) group systems

D) support software

Diff: 2

AACSB: Information technology

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Analytical

46) Expert systems are primarily used to help what kinds of decision makers?

A) lower-level managers

B) top managers

C) senior managers

D) experts

Diff: 2

AACSB: Information technology

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Analytical

47) Neural networks are able to outdo the performance of humans by ________.

A) analyzing symbols

B) handling up to three variables at once

C) handling hundreds of variables at once

D) reading facial expressions

Diff: 2

AACSB: Information technology

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Analytical

48) Neural networks differ from expert systems in that they can ________.

A) draw conclusions from data

B) ask questions to the decision maker

C) perform sophisticated calculations

D) learn from experience

Diff: 2

AACSB: Information technology

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Analytical

49) Neural networks outperform expert systems in uncovering ________.

A) credit card fraud

B) false positives for pregnancy

C) potential credit card customers

D) credit problems in bank mortgages

Diff: 2

AACSB: Information technology

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Analytical

50) Herbert Simon won the Nobel Prize in economics for his work in describing ________.

A) how people spend money

B) how most people are perfectly rational

C) how people make decisions

D) how people avoid decisions

Diff: 2

AACSB: Analytical thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Analytical

51) Which one of the following is the best definition for the word satisfice?

A) very satisfying

B) not sufficient

C) accepts a less than perfect solution

D) requires a perfect solution

Diff: 2

AACSB: Analytical thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Concept

52) Herbert Simon found that in making decisions, most people satisficed because they had limited ability to ________.

A) be truthful and honest in situations that deal with other people

B) think independently

C) deal with difficult situations

D) grasp present conditions and anticipate future conditions

Diff: 2

AACSB: Analytical thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Analytical

53) A person who satisfices fails to ________.

A) maximize his or her decision

B) understand his or her position

C) accept the truth of a situation

D) make any kind of decision

Diff: 2

AACSB: Analytical thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Concept

54) Sticking to a decision despite evidence that it is a mistake is called ________.

A) escalation of commitment

B) escalation of rationality

C) satisficing commitment

D) error enhancement

Diff: 2

AACSB: Analytical thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Concept

55) Escalation of commitment can occur when people don't ________.

A) want to make a decision

B) want to admit that an earlier decision was flawed

C) accept current conditions

D) understand that conditions have changed

Diff: 2

AACSB: Analytical thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Concept

56) Which model of decision making takes advantage of unconscious reasoning?

A) rational

B) nonrational

C) intuitive

D) factual

Diff: 2

AACSB: Reflective thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Concept

57) Compared to fully rational decision making, what is a major advantage of intuitive decision making?

A) total reliability

B) fully quantified

C) thoroughness

D) speed

Diff: 2

AACSB: Reflective thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Concept

58) Approximately what percentage of managers typically use intuitive decision making rather than formal analysis to make decisions?

A) 95%

B) 75%

C) almost 50%

D) less than 10%

Diff: 2

AACSB: Analytical thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Analytical

59) Intuitive decision making ________.

A) should be avoided by managers in making day to day decisions

B) is often described as conscious decision making

C) can complement other decision making approaches

D) takes more time than other approaches as it requires managers to shift through feelings and emotions and place them in context with actual facts.

Diff: 2

AACSB: Analytical thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Concept

60) Which one of the following is NOT a way in which intuition guides people who are making decisions?

A) Intuition provides ethics and values guidelines.

B) Intuition provides a formal analysis method.

C) Intuition provides experiences to draw from.

D) Intuition draws on knowledge, skills, and training.

Diff: 2

AACSB: Reflective thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Concept

61) Emotions and feelings ________ decision making.

A) often have no effect on

B) can improve

C) always decrease performance in

D) are more important than facts and logic in

Diff: 2

AACSB: Reflective thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Concept

62) A rational decision will never fail to provide the best and most successful solution to a problem.

Diff: 1

AACSB: Reflective thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Concept

63) Being completely rational is a realistic goal for today's managers.

Diff: 2

AACSB: Reflective thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Concept

64) One assumption of bounded rationality is that managers can analyze all relevant information about all alternatives for a situation.

Diff: 2

AACSB: Reflective thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Concept

65) A synonym for the word satisfice is maximize.

Diff: 2

AACSB: Analytical thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Concept

66) One assumption of bounded rationality is that managers usually attempt to make rational decisions.

Diff: 2

AACSB: Reflective thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Concept

67) Intuitive decision making is systematic, logical, and orderly.

Diff: 2

AACSB: Reflective thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Concept

68) Intuitive decision making should not be a part of a manager's decision-making process.

Diff: 2

AACSB: Reflective thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Concept

69) The expression "throwing good money after bad" is an example of an escalation of commitment.

Diff: 2

AACSB: Analytical thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Analytical

70) Personal judgments and emotions should always be strictly ignored in a decision-making process.

Diff: 2

AACSB: Reflective thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Analytical

71) In a short essay, discuss bounded rationality and satisficing.

Diff: 3

AACSB: Analytical thinking

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Concept

72) In a short essay, discuss the assumptions of rationality and the validity of those assumptions.

The assumptions of rationality apply to any decision. Rational managerial decision making assumes that decisions are made in the best economic interests of the organization. That is, the decision maker is assumed to be maximizing the organization's interests, not his or her own interests.

Managerial decision making can follow rational assumptions if the following conditions are met: the manager is faced with a simple problem in which the goals are clear and the alternatives are limited; the time pressures are minimal; and the cost of seeking out and evaluating alternatives is low. However, most decisions that managers face in the real world don't meet all of those tests.

Diff: 2

AACSB: Application of knowledge

LO: 4.2: Explain the three approaches managers can use to make decisions.

Question Category: Concept

73) Structured problems are ________.

A) ambiguous

B) undefined and vague

C) clear and straightforward

D) incomplete

Diff: 2

AACSB: Reflective thinking

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Concept

74) Unstructured problems are ________.

A) perfectly rational

B) clear and straightforward

C) situations in which all options are known

D) situations in which all options are not known

Diff: 2

AACSB: Reflective thinking

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Concept

75) Which one of the following is an example of a structured problem?

A) designing a new digital music player

B) hiring a lawyer

C) deciding shipping options for a vacuum cleaner

D) drafting a quarterback for a pro football team

Diff: 2

AACSB: Analytical thinking

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Application

76) Which one of the following is an example of an unstructured problem?

A) finding the list price of different copy machines

B) choosing the best wardrobe for an executive

C) comparing gas mileage for different car models

D) measuring pollution levels in a power plant

Diff: 2

AACSB: Analytical thinking

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Analytical

77) Structured problems typically have ________ while unstructured problems typically have ________.

A) only one solution; many solutions

B) many solutions; one solution

C) many solutions; fewer solutions

D) two solutions; three solutions

Diff: 2

AACSB: Reflective thinking

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Concept

78) Programmed decisions work well for solving ________.

A) structured problems

B) unstructured problems

C) both structured and unstructured problems

D) poorly defined problems

Diff: 2

AACSB: Reflective thinking

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Concept

79) Programmed decisions draw heavily on which one of the following?

A) mistakes made in the past

B) past solutions that were successful

C) past solutions that were unsuccessful

D) innovative, new solutions

Diff: 2

AACSB: Analytical thinking

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Concept

80) Which one of the following is NOT a type of programmed decision?

A) systematic procedure

B) policy

C) brainstorm

D) rule

Diff: 2

AACSB: Analytical thinking

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Concept

81) Following the directions to put together an elliptical exercise machine is an example of which way to solve a problem?

A) procedure

B) rule

C) general practice

D) policy

Diff: 1

AACSB: Application of knowledge

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Application

82) A football coach makes the decision to punt or not to punt on fourth down based on whether he is past his own 50-yard line. Which decision-making method does the coach use?

A) a policy

B) a hunch

C) a procedure

D) a rule

Diff: 2

AACSB: Analytical thinking

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Analytical

83) Which pair of terms is correctly matched up?

A) structured problem, programmed decision

B) structured problem, structured decision

C) unstructured problem, programmed decision

D) structured problem, nonprogrammed decision

Diff: 3

AACSB: Analytical thinking

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Analytical

84) A judge consults guidelines before handing down an award for damages in a legal case. What kind of decision making is she doing?

A) following a policy

B) following a rule

C) programmed

D) following a procedure

Diff: 2

AACSB: Application of knowledge

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Application

85) Top managers in an organization tend to ________.

A) make programmed decisions

B) solve structured problems

C) make nonprogrammed decisions

D) solve well-defined problems

Diff: 2

AACSB: Analytical thinking

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Analytical

86) Which three conditions do decision makers face?

A) certainty, risk, uncertainty

B) certainty, uncertainty, confidence

C) risk, high risk, low risk

D) certainty, risk, high risk

Diff: 2

AACSB: Analytical thinking

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Concept

87) In a condition of certainty, ________.

A) most outcomes are known

B) the decision is already made

C) all outcomes of all alternatives are known

D) some alternatives are not known

Diff: 2

AACSB: Analytical thinking

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Concept

88) If a car buyer knows the inventory dealer price of the same car at different dealerships, he or she is operating under what type of decision-making condition?

A) risk

B) uncertainty

C) certainty

D) factual

Diff: 2

AACSB: Application of knowledge

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Application

89) A retail clothing store manager who estimates how much to order for the current spring season based on last spring's outcomes is operating under what kind of decision-making condition?

A) seasonal

B) risk

C) uncertainty

D) certainty

Diff: 2

AACSB: Application of knowledge

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Application

90) ________ is a situation in which a decision maker has incomplete information about outcomes and does not have the ability to reasonably estimate outcomes that are not known.

A) Certainty

B) Risk

C) Uncertainty

D) High certainty

Diff: 2

AACSB: Analytical thinking

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Concept

91) A low-level manager is most likely to solve problems under which condition?

A) certainty

B) low risk

C) uncertainty

D) low certainty

Diff: 2

AACSB: Analytical thinking

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Analytical

92) A top-level manager is most likely to solve problems under which condition?

A) certainty

B) risk

C) uncertainty

D) high certainty

Diff: 2

AACSB: Analytical thinking

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Analytical

93) A manager has a choice of three investment funds. To assess them, he looks at their investment records over the previous five years. The manager is operating under which condition?

A) certainty

B) probability

C) uncertainty

D) risk

Diff: 2

AACSB: Application of knowledge

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Application

94) A manager has a choice of three bank CDs that pay different amounts of fixed interest over different time periods. The manager is operating under which condition?

A) jeopardy

B) certainty

C) uncertainty

D) risk

Diff: 2

AACSB: Application of knowledge

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Application

95) A manager wants to invest in one of three start-up companies. All three of the companies seem to have a good business plan. None of the companies has a track record. The manager is operating under which condition?

A) uncertainty

B) certainty

C) low certainty

D) risk

Diff: 2

AACSB: Application of knowledge

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Application

96) A key to what is commonly used to assess risk is for a decision maker to examine the ________ an investment.

A) promises made by a company for

B) ads posted by a company for

C) historical data for

D) minor details of

Diff: 3

AACSB: Analytical thinking

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Analytical

97) Programmed decisions tend to be routine.

Diff: 1

AACSB: Analytical thinking

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Concept

98) A rule is simpler than a policy or a procedure to implement.

Diff: 2

AACSB: Analytical thinking

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Concept

99) Implementing a procedure requires more judgment and interpretation than implementing a policy.

Diff: 3

AACSB: Analytical thinking

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Analytical

100) A highway speed limit is an example of a policy.

Diff: 2

AACSB: Application of knowledge

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Application

101) Managerial decisions are likely to become more programmed as managers rise in an organizational hierarchy.

Diff: 2

AACSB: Reflective thinking

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Concept

102) Most managerial decisions include an element of risk.

Diff: 2

AACSB: Analytical thinking

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Analytical

103) Uncertainty involves a situation in which the probability of a certain outcome is known to be small.

Diff: 3

AACSB: Reflective thinking

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Concept

104) A manager is more confident of his or her assessment of a situation if it involves risk rather than uncertainty.

Diff: 3

AACSB: Analytical thinking

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Analytical

105) In a short essay, discuss the differences among a procedure, a rule, and a policy. Include specific examples of each to support your answer.

A rule is an explicit statement that tells a manager what he or she can or cannot do. Managers frequently use rules when they confront a well-structured problem because rules are simple to follow and ensure consistency. For example, a rule at a local tennis club might dictate that if the courts are full, players can play no longer than one hour. When their hour is up they can get bumped from their court.

A policy provides guidelines to channel a manager's thinking in a specific direction. In contrast to a rule, a policy establishes parameters for the decision maker rather than specifically stating what should or should not be done. Policies differ from procedures in that they typically leave quite a bit of interpretation up to the decision maker. An example of a policy is guidelines that require scientists at a research lab to have an advanced degree in their field, at least three years of postdoctoral work, and at least five published scientific papers to their credit. These requirements are guidelines—candidates who lack all of the qualifications but have other strengths may also be considered for the job. It would be up to the decision maker to determine how rigorously the policy would be followed.

Diff: 2

AACSB: Analytical thinking

LO: 4.3: Describe the types of decisions and decision-making conditions managers face.

Question Category: Concept

106) Managers in organizations make group decisions ________.

A) frequently

B) never

C) almost never

D) rarely

Diff: 1

AACSB: Interpersonal relations and teamwork

LO: 4.4: Discuss group decision making.

Question Category: Concept

107) The eight steps of decision making ________.

A) can only be employed by individuals

B) can only be employed in very small groups

C) can be employed by individuals and groups

D) can only be employed by groups

Diff: 2

AACSB: Interpersonal relations and teamwork

LO: 4.4: Discuss group decision making.

Question Category: Analytical

108) One advantage of group decision making is that it usually provides ________ than individual decision making.

A) faster decisions

B) more ethical decisions

C) less confusion

D) more information

Diff: 2

AACSB: Interpersonal relations and teamwork

LO: 4.4: Discuss group decision making.

Question Category: Analytical

109) Group decisions generally feature ________ acceptance than decisions made by an individual.

A) greater

B) less

C) neither greater nor less

D) more enthusiastic

Diff: 2

AACSB: Interpersonal relations and teamwork

LO: 4.4: Discuss group decision making.

Question Category: Analytical

110) Group decision making typically increases the legitimacy of a decision because the decision was made ________.

A) over a long period of time

B) democratically

C) by experts

D) primarily by the group leader

Diff: 2

AACSB: Interpersonal relations and teamwork

LO: 4.4: Discuss group decision making.

Question Category: Analytical

111) Decisions made by individuals typically suffer from suspicions that the decision maker ________.

A) is dishonest

B) is not rational

C) did not try to analyze the situation

D) did not consult all interested parties

Diff: 2

AACSB: Interpersonal relations and teamwork

LO: 4.4: Discuss group decision making.

Question Category: Analytical

112) Seeking the views of a diverse group of people can provide a decision maker with ________ on issues.

A) fresh perspectives

B) conventional wisdom

C) universal agreement

D) a foolproof way to get the perfect answer

Diff: 2

AACSB: Interpersonal relations and teamwork

LO: 4.4: Discuss group decision making.

Question Category: Concept

113) Which one of the following is a drawback to seeking diverse views in decision making?

A) less reliable decision

B) easier decision-making process

C) more time consuming

D) less time consuming

Diff: 2

AACSB: Interpersonal relations and teamwork

LO: 4.4: Discuss group decision making.

Question Category: Concept

114) What tends to be the most successful group size?

A) 10-25

B) 5-7

C) 12-25

D) 3-12

Diff: 2

AACSB: Interpersonal relations and teamwork

LO: 4.4: Discuss group decision making.

Question Category: Concept

115) Group decisions are usually ________ individual decisions.

A) more efficient than

B) less efficient than

C) equal in efficiency to

D) more efficient but less effective than

Diff: 2

AACSB: Interpersonal relations and teamwork

LO: 4.4: Discuss group decision making.

Question Category: Concept

116) Since all members of a group are rarely equal in status, most groups suffer from ________.

A) minority domination

B) majority domination

C) too much diversity

D) gridlock

Diff: 2

AACSB: Interpersonal relations and teamwork

LO: 4.4: Discuss group decision making.

Question Category: Concept

117) ________ can cause people in a group to fail to express their true opinions.

A) Ambiguous responsibility

B) Group imbalance

C) Pressure to conform

D) Years of experience

Diff: 2

AACSB: Interpersonal relations and teamwork

LO: 4.4: Discuss group decision making.

Question Category: Concept

118) Which one of the following is a primary characteristic of groupthink?

A) conflict among group members

B) failure to reach consensus within a group

C) complete conformity among group members

D) candidness and openness within a group

Diff: 3

AACSB: Interpersonal relations and teamwork

LO: 4.4: Discuss group decision making.

Question Category: Concept

119) Which one of the following is NOT a factor that can increase the probability of groupthink?

A) Influential group members dominate the discussion and the decision-making process.

B) Group leaders stress the importance of consensus above all other concerns.

C) The group has more than 40 group members.

D) Group leaders solicit ideas from all group members without passing judgment on their ideas.

Diff: 3

AACSB: Interpersonal relations and teamwork

LO: 4.4: Discuss group decision making.

Question Category: Concept

120) Which one of the following is NOT a way to minimize groupthink?

A) give the leader more power in making decisions

B) encourage cohesion

C) have an impartial leader

D) foster open discussion

Diff: 2

AACSB: Interpersonal relations and teamwork

LO: 4.4: Discuss group decision making.

Question Category: Concept

121) Which one of the following group techniques is relatively simple and is used exclusively to generate creative ideas in a group setting?

A) brainstorming

B) nominal group technique

C) groupthink

D) electronic meetings

Diff: 3

AACSB: Interpersonal relations and teamwork

LO: 4.4: Discuss group decision making.

Question Category: Concept

122) Which one of the following is NOT allowed in a brainstorming session?

A) clear definition of the problem

B) criticism or dismissal of poor ideas

C) large number of alternatives

D) recording of all alternatives

Diff: 2

AACSB: Interpersonal relations and teamwork

LO: 4.4: Discuss group decision making.

Question Category: Concept

123) Which one of the following group techniques allows group members to meet together, but at the same time facilitates independent decision making?

A) brainstorming

B) nominal group technique

C) large meetings of over 50 individuals

D) small meetings of less than 10 individuals

Diff: 2

AACSB: Interpersonal relations and teamwork

LO: 4.4: Discuss group decision making.

Question Category: Concept

124) The ________ blends the nominal group technique with sophisticated computer technology.

A) personal meeting

B) electronic meeting

C) virtual meeting

D) preliminary meeting

Diff: 2

AACSB: Information technology

LO: 4.4: Discuss group decision making.

Question Category: Concept

125) What advantages does videoconferencing provide for group decision making?

A) anonymous expression of opinions

B) less groupthink

C) less minority domination

D) savings on travel and time

Diff: 2

AACSB: Information technology

LO: 4.4: Discuss group decision making.

Question Category: Analytical

126) The second step in the decision-making process is identifying a problem.

Diff: 1

AACSB: Analytical thinking

LO: 4.4: Discuss group decision making.

Question Category: Concept

127) Group decisions tend to provide more complete information than individual decisions.

Diff: 1

AACSB: Interpersonal relations and teamwork

LO: 4.4: Discuss group decision making.

Question Category: Concept

128) An advantage of group decisions is that they increase the perception of the legitimacy of the solution.

Diff: 1

AACSB: Interpersonal relations and teamwork

LO: 4.4: Discuss group decision making.

Question Category: Concept

129) A drawback of group decision making is groupthink.

Diff: 1

AACSB: Interpersonal relations and teamwork

LO: 4.4: Discuss group decision making.

Question Category: Concept

130) Groups tend to be more efficient and less effective than individual decision making.

Diff: 2

AACSB: Interpersonal relations and teamwork

LO: 4.4: Discuss group decision making.

Question Category: Concept

131) Two major advantages of electronic meetings are anonymity and honesty.

Diff: 2

AACSB: Information technology

LO: 4.4: Discuss group decision making.

Question Category: Concept

132) In a short essay, identify and explain the advantages and disadvantages of group decision making.

Group decisions are not without their drawbacks. It takes time to assemble a group, and the interaction that takes place once the group is in place is frequently inefficient. Groups almost always take more time to reach a solution than an individual would take to make the decision alone. Groups may also be subject to minority domination, in which one or a few group members compel others to adhere to their agenda.

Another problem is the pressure to conform in groups. In groupthink, a form of conformity, group members withhold their views in order to avoid controversy, avoid taking responsibility for their actions, and give the appearance of agreement. As a result, groupthink undermines critical thinking in the group and eventually harms the quality of the final decision. And, finally, ambiguous responsibility can become a problem. Group members share responsibility, so the responsibility of any single member is watered down and no one ends up taking "ownership" of the group's final decision.

Diff: 2

AACSB: Interpersonal relations and teamwork

LO: 4.4: Discuss group decision making.

Question Category: Critical thinking

133) In a short essay, describe how brainstorming can help avoid groupthink and enhance creativity in group decision making.

Diff: 2

AACSB: Interpersonal relations and teamwork

LO: 4.4: Discuss group decision making.

Question Category: Critical thinking

134) In a short essay, describe how nominal group technique can help avoid groupthink and enhance creativity in group decision making.

Diff: 2

AACSB: Analytical thinking

LO: 4.4: Discuss group decision making.

Question Category: Critical thinking

135) In a short essay, describe how electronic meetings can help avoid groupthink and enhance creativity in group decision making.

Diff: 2

AACSB: Information technology

LO: 4.4: Discuss group decision making.

Question Category: Critical thinking

136) Mid-level managers in a country with high power distance are ________ than managers from a low power distance country.

A) more likely to make risky decisions

B) less likely to make risky decisions

C) less likely to make safe, conservative decisions

D) more likely to disagree with their leaders' decisions

Diff: 1

AACSB: Diverse and multicultural work environments

LO: 4.5: Discuss contemporary issues in managerial decision making.

Question Category: Analytical

137) Mid-level managers in a country with low uncertainty avoidance are ________ than managers from a high uncertainty avoidance country.

A) more likely to make risky decisions

B) less likely to make risky decisions

C) less likely to make foolish decisions

D) more likely to avoid making decisions

Diff: 1

AACSB: Diverse and multicultural work environments

LO: 4.5: Discuss contemporary issues in managerial decision making.

Question Category: Analytical

138) Individualistic countries like the United States tend to have ________ than group-oriented countries like Japan.

A) more conformity and more cooperation

B) more conformity and less cooperation

C) less conformity and more cooperation

D) less conformity and less cooperation

Diff: 1

AACSB: Diverse and multicultural work environments

LO: 4.5: Discuss contemporary issues in managerial decision making.

Question Category: Analytical

139) The use of ringisei in Japanese organizations reflects which one of the following values in Japanese culture?

A) tradition-following

B) consensus-seeking

C) risk taking

D) go-it-alone

Diff: 2

AACSB: Diverse and multicultural work environments

LO: 4.5: Discuss contemporary issues in managerial decision making.

Question Category: Concept

140) French management style tends to be ________ in style.

A) permissive

B) group oriented

C) rule following

D) autocratic

Diff: 2

AACSB: Diverse and multicultural work environments

LO: 4.5: Discuss contemporary issues in managerial decision making.

Question Category: Concept

141) When dealing with international organizations, managers must be ________ in order to accommodate the managing styles of different cultures.

A) as flexible as possible

B) as inflexible as possible

C) as strict as possible

D) as thorough as possible

Diff: 2

AACSB: Diverse and multicultural work environments

LO: 4.5: Discuss contemporary issues in managerial decision making.

Question Category: Analytical

142) ________ helps people find better solutions to problems using innovative problem-solving methods.

A) Planning

B) Creativity

C) Organization

D) Structure

Diff: 2

AACSB: Analytical thinking

LO: 4.5: Discuss contemporary issues in managerial decision making.

Question Category: Concept

143) According to one study, about ________ of men and women were somewhat creative.

A) 1 percent

B) 10 percent

C) 30 percent

D) 60 percent

Diff: 2

AACSB: Analytical thinking

LO: 4.5: Discuss contemporary issues in managerial decision making.

Question Category: Concept

144) One well-accepted model states that individual creativity requires ________, or a commanding understanding of a subject matter.

A) expertise

B) task motivation

C) high interest

D) intuition

Diff: 2

AACSB: Analytical thinking

LO: 4.5: Discuss contemporary issues in managerial decision making.

Question Category: Concept

145) Which one of the following is NOT a characteristic of a creative problem solver?

A) self confidence

B) tolerance for ambiguity

C) frustrates easily

D) accepts risks readily

Diff: 2

AACSB: Analytical thinking

LO: 4.5: Discuss contemporary issues in managerial decision making.

Question Category: Analytical

146) Which one of the following traits do all creative people seem to share?

A) They like to save time.

B) They get along well with others.

C) They love their work.

D) They don't like to work hard.

Diff: 2

AACSB: Analytical thinking

LO: 4.5: Discuss contemporary issues in managerial decision making.

Question Category: Analytical

147) Which one of the following tends to impede a person's creativity?

A) providing time and resources

B) clearly defined goals

C) being watched while you work

D) internal motivation

Diff: 2

AACSB: Analytical thinking

LO: 4.5: Discuss contemporary issues in managerial decision making.

Question Category: Analytical

148) A country with high uncertainty avoidance and high power distance is more likely to engage in groupthink than a country with low uncertainty avoidance and low power distance.

Diff: 3

AACSB: Diverse and multicultural work environments

LO: 4.5: Discuss contemporary issues in managerial decision making.

Question Category: Analytical

149) Creativity is valued because it helps identify new and viable alternatives that have not previously been considered.

Diff: 1

AACSB: Analytical thinking

LO: 4.5: Discuss contemporary issues in managerial decision making.

Question Category: Concept

150) In a short essay, discuss why creativity is important to decision making. Describe a situation in which a creative solution is used to solve a problem.

An example of a creative solution to a problem is the recent development of a software bowling game for senior citizens. Rather than try to develop a new game for children or young adults—two fairly saturated markets—the company turned its attention to a neglected market, senior citizens. Could the company get seniors—who typically don't use computers—to play video games? They could if they created the right game.

The company worked hard to develop a program that was "friendly" to its typical user—a senior citizen who had no computer skills or knowledge. The result was a huge hit. Seniors all over the United States now rave about this fun new game. Leagues have formed. Tournaments have been organized. Seniors especially enjoy the fact that they can play the game at home and that physical disabilities don't prevent them from playing. The success of the game is a good example of how being creative can solve a problem.

Diff: 3

AACSB: Application of knowledge

LO: 4.5: Discuss contemporary issues in managerial decision making.

Question Category: Critical thinking