36) Decision making begins with ________.

C) identifying a problem
37) Which 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
38) The decision-making process consists of a series of eight steps that identify a problem and work toward ultimately ________.
B) solving the problem
39) To identify a problem, a manager ________.
D) compares the current state of affairs with some standard or goal
40) 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
41) 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
42) 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?
C) development of alternatives
43) 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?
B) evaluation of decision effectiveness
44) For a high-tech bicycle buyer, decision criteria would be determined by ________.
D) personal preferences of the buyer
45) Which of the following is LEAST likely to be a decision criterion for a high-tech bicycle buyer who cares primarily about performance?
A) warranty
46) Which of the following would be a fairly objective criterion by which a bicycle buyer could assess different bike models?
B) weight
47) A manager chooses to ignore a rigorous decision-making process and select TV monitor A over monitor B because he "trusts" company A more than company B. If the decision he made was
rational, which of the following is true?
B) The manager should have included "trust" as a criterion.
48) In allocating weights to the decision criteria, which of the following is most helpful to remember?
D) Assign the most important criterion a score, and then assign weights against that standard.
49) What is a heuristic?
D) a shortcut or rule of thumb that is used for decision making
50) 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
51) Which of the following is NOT a reason why managers often resort to using heuristics?
D) They thoroughly explore all alternatives.
52) 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?
B) immediate gratification
53) 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?
C) confirmation bias
54) 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) ________.
D) framing bias
55) Which of the following is NOT a common decision-making error or bias?
C) forest for the trees
56) The three main models that managers use to make decisions are ________.
A) rational, bounded rational, and intuitive
57) It is assumed that a rational decision maker ________.
D) would be objective and logical
58) What does it mean for a decision maker to maximize value?
B) to make the achievement of goals as likely as possible
59) Maximizing value for an organization means making sure that ________.
B) the best interests of the organization are addressed
60) Which of the following is NOT assumed in a rational decision?
C) many alternatives and consequences are known
61) It is assumed that in most cases, the decisions of all managers are limited by ________.
C) not being able to analyze all information for all alternatives
62) Which term best characterizes a decision that has bounded rationality?
D) good enough
63) Software programs that use a series of questions to aid humans in decision making are called ________.
B) expert systems
64) Expert systems are primarily used to help what kinds of decision makers?
A) lower-level managers
65) Neural networks are able to outdo the performance of humans by ________.
C) handling hundreds of variables at once
66) Neural networks differ from expert systems in that they can ________.
D) learn from experience
Answer: D
67) Neural networks outperfom expert systems in uncovering ________.
A) credit card fraud
68) Herbert Simon won the Nobel Prize in economics for his work in describing ________.
C) how people make decisions
69) Which of the following is the best definition for the word satisfice?
C) accepts a less than perfect solution
70) Simon found that in making decisions, most people satisficed because they had limited ability to ________.
D) grasp present conditions and anticipate future conditions
71) A person who satisfices fails to ________.
A) maximize his or her decision
72) Sticking to a decision despite evidence that it is a mistake is called ________.
A) escalation of commitment
73) Escalation of commitment can occur when people don't ________.
B) want to admit that an earlier decision was flawed
74) Which model of decision making takes advantage of unconscious reasoning?
C) intuitive
75) Compared to fully rational decision making, what is a major advantage of intuitive decision making?
D) speed
76) How often do managers typically use intuitive decision making?
D) more than half of the time
77) Intuitive decision making can complement ________.
C) both rationality and bounded rationality
78) Which of the following is NOT a way in which intuition guides people who are making decisions?
B) Intuition provides a formal analysis method.
79) Emotions and feelings ________ decision making.
B) can improve
80) Structured problems are ________.
C) clear and straightforward
81) Unstructured problems are ________.
D) situations in which all options are not known
82) Which of the following is an example of a structured problem?
C) deciding shipping options for a vacuum cleaner
83) Which of the following is an example of an unstructured problem?
B) choosing the best wardrobe for an executive
84) Structured problems typically have ________ while unstructured problems typically have ________.
A) only one solution; many solutions
85) Programmed decisions work well for solving ________.
A) structured problems
86) Programmed decisions draw heavily on which of the following?
B) past solutions that were successful
87) Which of the following is NOT a type of programmed decision?
C) brainstorm
88) Following the directions to put together an elliptical exercise machine is an example of which way to solve a problem?
A) procedure
89) A football coach makes the decision to punt or not to punt on fourth down based on whether or not he is past his own 50-yard line. Which decision-making method does the coach use?
D) a rule
90) Which pair or pairs of terms is true? (This question can have more than one correct answer.)
A) structured problem, programmed decision
D) unstructured problem, nonprogrammed decision
91) 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
92) Top managers in an organization tend to ________.
C) make nonprogrammed decisions
93) Which three conditions do decision makers face?
A) certainty, risk, uncertainty
94) In a condition of certainty, ________.
C) all outcomes of all alternatives are known
95) 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?
C) certainty
96) 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?
B) risk
97) ________ is a situation in which a decision maker has only incomplete information about outcomes and does not have ability to reasonably estimate outcomes that are not known.
C) Uncertainty
98) A low-level manager is most likely to solve problems under which condition?
A) certainty
99) A top manager is most likely to solve problems under which condition?
C) uncertainty
100) A manager has a choice of three investment funds. To assess them, he looks at their past investment records over the previous five years. The manager is operating under which condition?
D) risk
101) A manager has a choice of three bank CDs that pay different amounts of interest over different time periods. The manager is operating under which condition?
B) certainty
102) 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
103) A key to what is commonly used to assess risk is for a decision maker to examine the ________ an investment.
C) historical data for
104) Managers in organizations make group decisions ________.
A) frequently
105) The eight steps of decision making ________.
C) can be employed by individuals and groups
106) One advantage of group decision making is that it usually provides ________ than individual decision making.
D) more information
107) Group decisions generally feature ________ acceptance than decisions made by an individual.
A) greater
108) Group decision making typically increases the legitimacy of a decision because the decision was made ________.
B) democratically
109) Decisions made by individuals typically suffer from suspicions that the decision maker ________
D) did not consult all interested parties
110) Seeking the views of a diverse group of people can provide a decision maker with ________ on issues.
A) fresh perspectives
111) Which of the following is a drawback to seeking diverse views in decision making?
C) more time consuming
112) Which phrase best summarizes the drawbacks of group decisions?
B) A camel is a racehorse put together by a committee.
113) Groups decisions are usually ________ individual decisions.
B) less efficient than
114) Since all members of a group are rarely equal in status, most groups suffer from ________.
A) minority domination
115) ________ can cause people in a group to fail to express their true opinions.
C) Pressure to conform
116) Which of the following is a primary characteristic of groupthink?
C) complete conformity among group members
117) Which of the following is NOT a factor that can increase the probability of groupthink?
D) Group leaders solicit ideas from all group members without passing judgment on their ideas.
118) Which of the following is the most effective number of people to have in a group?
A) 5-7
119) Which of the following is used to exclusively generate creative ideas in a group setting?
A) brainstorming
120) Which of the following is NOT allowed in a brainstorming session?
B) criticism or dismissal of poor ideas
121) Which of the following group techniques allows group members to meet together, but at the same time facilitates independent decision making?
B) nominal group technique
122) The ________ blends the nominal group technique with sophisticated computer technology.
B) electronic meeting
123) What advantages does videoconferencing provide for group decision making?
D) savings on travel and time
124) Mid-level managers in a country with high power distance are ________ than managers from a low power distance country.
B) less likely to make risky decisions
125) 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
126) Individualistic countries like the United States tend to have ________ than group-oriented countries like Japan.
D) less conformity and less cooperation
127) The use of ringisei in Japanese organizations reflects which of the following values in Japanese culture?
B) consensus-seeking
128) French management style tends to be ________ in style.
D) autocratic
129) When dealing with international organizations, managers must be ________ in order to accommodate the managing styles of different cultures.
A) as flexible as possible
130) ________ helps people find better solutions to problems using innovative problem-solving methods.
B) Creativity
131) According to one study, about ________ of men and women were somewhat creative.
D) 60 percent
132) One well-accepted model states that individual creativity requires ________, or a commanding understanding of a subject matter.
A) expertise
133) Which of the following is NOT a characteristic of a creative problem solver?
C) frustrates easily
134) Which of the following traits do all creative people seem to share?
C) They love their work.
135) Which of the following tends to impede a person's creativity?
C) being watched while you work
136) According to the decision-making process, the first step Sondra should take is to ________.
D) identify the problem
137) 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?
B) identify decision criteria
138) 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
139) 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?
C) implementing the alternative
140) The very last step Sondra should take, according to the decision-making process, is to ________.
D) evaluate the decision's effectiveness

1) In decision making, a problem can be defined as a discrepancy between what exists and what the problem solver desires to exist.
Answer: TRUE
2) The second step in the decision-making process is identifying a problem.
Answer: FALSE
3) A decision criterion defines factors that are relevant in a decision.
Answer: TRUE
4) Managers identify a problem by comparing the current state of affairs to some standard.
Answer: TRUE
5) All criteria are equally important in the decision-making process.
Answer: FALSE
6) Identifying the wrong problem is just as much a failure for a manager as identifying the right problem and failing to solve it.
Answer: TRUE
7) The final step of the decision-making process is to implement the alternative that has been selected.
Answer: FALSE
8) A heuristic can simplify the decision-making process.
Answer: TRUE
9) Because heuristics simplify the decision-making process, they are unlikely to lead to errors.
Answer: FALSE
10) Decision makers who "cherry-pick" information that matches what they already know are guilty of confirmation bias.
Answer: TRUE
11) A basketball coach who takes a very good shooter out of a game because she missed her last two shots has availability bias.
Answer: TRUE
12) A rational decision will never fail to provide the best and most successful solution to a problem.
Answer: FALSE
13) Maximizing value means a decision will have the best possible outcome for the parties involved.
Answer: TRUE
14) One assumption of bounded rationality is that managers can analyze all relevant information about all alternatives for a situation.
Answer: FALSE
15) A synonym for the word satisfice is maximize.
Answer: FALSE
16) One assumption of bounded rationality is that managers usually make rational decisions.
Answer: TRUE
17) Intuitive decision making is systematic, logical, and orderly.
Answer: FALSE
18) Intuitive decision making cannot be a part of the rational decision-making process.
Answer: FALSE
19) The expression "throwing good money after bad" is an example of an escalation of commitment. Answer: TRUE
20) Emotions should always be strictly ignored in a decision-making process.
Answer: FALSE
21) Programmed decisions tend to be routine.
Answer: TRUE
22) A rule is simpler than a policy or a procedure to implement.
Answer: TRUE
23) Implementing a procedure requires more judgment and interpretation than implementing a policy.
Answer: FALSE
24) A highway speed limit is an example of a policy.
Answer: FALSE
25) Managerial decisions are likely to become more programmed as managers rise in an organizational hierarchy.
Answer: FALSE
26) Most managerial decisions include an element of risk.
Answer: TRUE
27) Uncertainty involves a situation in which the probability of a certain outcome is known to be small.
Answer: FALSE
28) A manager is more confident of his assessment of a situation if it involves risk rather than uncertainty.
Answer: TRUE
29) Group decisions tend to provide more complete information than individual decisions.
Answer: TRUE
30) An advantage of group decisions is that they increase the perception of the legitimacy of the solution.
Answer: TRUE
31) A drawback of group decision making is groupthink.
Answer: FALSE
32) Groups tend to be more efficient and less effective than individual decision making.
Answer: TRUE
33) Two major advantages of electronic meetings are anonymity and honesty.
Answer: TRUE
34) 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.
Answer: TRUE
35) Creative solutions to problems are valued because they are new and different from traditional solutions.
Answer: FALSE