Question 1

__________ occurs when decision makers incorrectly fixate on past expenditures of time, money, or effort in assessing choices rather than focusing on future consequences.

Accepted Answer

A)  hindsight bias 
B)  confirmation bias 
C)  overconfidence bias 
D)  sunk costs error 
E)  self-serving bias 
A)  hindsight bias 
B)  confirmation bias 
C)  overconfidence bias 
D)  sunk costs error 
E)  self-serving bias

Question 2

Refer to the scenario below to answer the following questions.
The Loaned Car (Scenario)
Colleen is a student, and her older brother has loaned her an old car. The car is in need of several repairs before she will feel comfortable driving it.
-Before talking with an automotive repair person, Colleen needs to assess which factors are relevant to her decision. The car needs new brakes, tires, a muffler, a tune-up, and could also use some bodywork to repair dents and scratches. After consideration, Colleen decides that safety and reliability are relevant. This is which step in the decision-making process?

Accepted Answer

A)  weigh the decision criteria 
B)  analyze alternatives 
C)  identify decision criteria 
D)  develop alternatives 
E)  select an alternative 
A)  weigh the decision criteria 
B)  analyze alternatives 
C)  identify decision criteria 
D)  develop alternatives 
E)  select an alternative

Question 3

Highly reliable organizations (HROs) make decisions at the executive level.

Accepted Answer

A) True 
 B)False

Question 4

Which of the following is a habit of successful highly reliable organizations (HROs)?

Accepted Answer

A)  They are preoccupied with their successes. 
B)  They defer decisions to the experts in upper management. 
C)  They let unexpected circumstances provide the solution. 
D)  They embrace simplicity. 
E)  They do not anticipate their limits. 
A)  They are preoccupied with their successes. 
B)  They defer decisions to the experts in upper management. 
C)  They let unexpected circumstances provide the solution. 
D)  They embrace simplicity. 
E)  They do not anticipate their limits.

Question 5

A policy __________.

Accepted Answer

A)  typically contains an ambiguous term that leaves room for interpretation 
B)  is frequently used when a manager faces an unstructured problem 
C)  allows little discretion on the part of the manager 
D)  offers strict rules as to how a problem should be solved 
E)  is a type of nonprogrammed decision 
A)  typically contains an ambiguous term that leaves room for interpretation 
B)  is frequently used when a manager faces an unstructured problem 
C)  allows little discretion on the part of the manager 
D)  offers strict rules as to how a problem should be solved 
E)  is a type of nonprogrammed decision

Question 6

A perfectly rational decision maker would __________.

Accepted Answer

A)  have changing preferences 
B)  not consider profit maximization as an objective 
C)  offer inconsistent decisions 
D)  be objective and logical 
E)  have to overcome time and cost constraints 
A)  have changing preferences 
B)  not consider profit maximization as an objective 
C)  offer inconsistent decisions 
D)  be objective and logical 
E)  have to overcome time and cost constraints

Question 7

Managers need to understand cultural differences to make effective decisions in today's fast-moving world.

Accepted Answer

A) True 
 B)False

Question 8

One assumption of rationality is that time and cost constraints exist.

Accepted Answer

A) True 
 B)False

Question 9

When the petty cash in Elaine's drawer falls to less than $25, she places a request for additional funds to bring the total back up to $100. This is an example of a(n) __________ decision.

Accepted Answer

A)  nonprogrammed 
B)  programmed 
C)  technical 
D)  structured 
E)  unstructured 
A)  nonprogrammed 
B)  programmed 
C)  technical 
D)  structured 
E)  unstructured

Question 10

Amanda, a single parent, is looking for a new job. Considering that she has two school-age children, she is particularly keen on finding an employer who can provide her with alternative work arrangements such as flexible work hours and telecommuting. In terms of the decision-making process, these represent Amanda's ________.

Accepted Answer

A)  criteria 
B)  problems 
C)  alternatives 
D)  guidelines 
E)  perceptions 
A)  criteria 
B)  problems 
C)  alternatives 
D)  guidelines 
E)  perceptions

Question 11

Refer to the scenario below to answer the following questions.
Decision-Making Conditions: Keep on Truckin' (Scenario)
Fiona Lui is general manager of Westcoast Trucks, a medium-sized hauling service located in Vancouver, B.C. She is responsible for scheduling trucks, initiating new routes, and staffing both existing and new routes. She is currently struggling to find more information about the profitability of existing and future truck routes.
-If Fiona wishes to minimize her regret about the truck route decision, she should follow a __________ strategy.

Accepted Answer

A)  multimax 
B)  minimin 
C)  minimax 
D)  maximax 
E)  maximin 
A)  multimax 
B)  minimin 
C)  minimax 
D)  maximax 
E)  maximin

Question 12

"No smoking allowed" is an example of a __________.

Accepted Answer

A)  rule 
B)  precedent 
C)  procedure 
D)  policy 
E)  guideline 
A)  rule 
B)  precedent 
C)  procedure 
D)  policy 
E)  guideline

Question 13

Refer to the scenario below to answer the following questions.
Decision-making Biases (Scenario)
Frank is president of Mega Manufacturing, a Canadian company that makes automobile parts. Sales and profits are down sharply this quarter, and Frank needs to analyze the series of events that have led to the poor performance. Frank begins by reviewing his recent interactions with Mike, the vice-president of sales.
-Mike asked Frank to authorize the expenditure of an additional $30,000 to continue to pursue the contract with the Japanese car maker, even though there is no indication that they will reconsider their decision. As Mike explained, "My sales team has already spent close to $100,000 in time and effort trying to win that contract. What's another $30,000 to try to convince them to switch to Mega?" Mike's fixation on past expenditures demonstrates which of the following?

Accepted Answer

A)  confirmation bias 
B)  hindsight bias 
C)  overconfidence bias 
D)  sunk costs error 
E)  anchoring effect 
A)  confirmation bias 
B)  hindsight bias 
C)  overconfidence bias 
D)  sunk costs error 
E)  anchoring effect

Question 14

Which of the following statements is true concerning problem identification?

Accepted Answer

A)  Problems are generally obvious. 
B)  A symptom and a problem are basically the same. 
C)  Well-trained managers generally agree on what is considered a problem. 
D)  The problem must exert some pressure on the manager to act. 
E)  To be considered a problem, managers must be aware of the discrepancy but not have sufficient resources to take action. 
A)  Problems are generally obvious. 
B)  A symptom and a problem are basically the same. 
C)  Well-trained managers generally agree on what is considered a problem. 
D)  The problem must exert some pressure on the manager to act. 
E)  To be considered a problem, managers must be aware of the discrepancy but not have sufficient resources to take action.

Question 15

Refer to the scenario below to answer the following questions.
The Loaned Car (Scenario)
Colleen is a student, and her older brother has loaned her an old car. The car is in need of several repairs before she will feel comfortable driving it.
-Colleen decides to have all of the mechanical problems fixed on the car. She assumes that the mechanic has found all the relevant problems and that he will be able to perform all the required repairs within the estimated quote he provided. Colleen decides to proceed with the repairs under which set of assumptions?

Accepted Answer

A)  intuition 
B)  irrationality 
C)  escalation of commitment 
D)  rationality 
E)  uncertainty 
A)  intuition 
B)  irrationality 
C)  escalation of commitment 
D)  rationality 
E)  uncertainty

Question 16

Highly reliable organizations (HROs) tap into their complexity to help them adapt more effectively.

Accepted Answer

A) True 
 B)False

Question 17

Refer to the scenario below to answer the following questions.
Types of Problems and Decisions (Scenario)
It seems Dave spends most of his day making decisions. Every time he turns around, someone wants him to make a decision about something. This morning, the office assistant came in and asked if she could reorder paper for the fax machine. That seemed like a routine decision that he should not have to deal with. If Dave could avoid those types of decisions, then he could focus more time and attention on the more complicated issues, such as the one presented to him by the production supervisor this afternoon. According to the supervisor, a major piece of equipment urgently needs repairs, and the repair bill could cost almost as much as a new machine!
-The problem of whether to order more fax paper is __________.

Accepted Answer

A)  programmed 
B)  nonprogrammed 
C)  structured 
D)  unstructured 
E)  technical 
A)  programmed 
B)  nonprogrammed 
C)  structured 
D)  unstructured 
E)  technical

Question 18

The assumption that managers make consistent, value-maximizing choices within specified constraints is known as which of the following?

Accepted Answer

A)  rational decision-making 
B)  unbounded rationality 
C)  organized decision-making 
D)  optimal decision-making 
E)  objective rationality 
A)  rational decision-making 
B)  unbounded rationality 
C)  organized decision-making 
D)  optimal decision-making 
E)  objective rationality

Question 19

A decision is a discrepancy between an existing and a desired state of affairs.

Accepted Answer

A) True 
 B)False

Question 20

"We strive to use environmentally safe materials" is an example of a __________.

Accepted Answer

A)  rule 
B)  policy 
C)  procedure 
D)  precedent 
E)  guideline 
A)  rule 
B)  policy 
C)  procedure 
D)  precedent 
E)  guideline

__________ occurs when decision makers incorrectly fixate on past expenditures of time, money, or effort in assessing choices rather than focusing on future consequences.

Highly reliable organizations (HROs) make decisions at the executive level.

Which of the following is a habit of successful highly reliable organizations (HROs)?

A policy __________.

A perfectly rational decision maker would __________.

Managers need to understand cultural differences to make effective decisions in today's fast-moving world.

One assumption of rationality is that time and cost constraints exist.

When the petty cash in Elaine's drawer falls to less than $25, she places a request for additional funds to bring the total back up to $100. This is an example of a(n) __________ decision.

"No smoking allowed" is an example of a __________.

Which of the following statements is true concerning problem identification?

Highly reliable organizations (HROs) tap into their complexity to help them adapt more effectively.

The assumption that managers make consistent, value-maximizing choices within specified constraints is known as which of the following?

A decision is a discrepancy between an existing and a desired state of affairs.

"We strive to use environmentally safe materials" is an example of a __________.

Introduction to Management and Organizations

Organizational Culture and the Organizational Environment

Managing in a Global Environment

Managing Entrepreneurially

Managing Responsibly and Ethically

Innovation and Adaptability

Foundations of Planning

Managing Strategically

Organizational Design

Managers and Communication

Managing Human Resources

Leadership

Motivating Employees

Managing Groups and Teams

Evidence-Based Decision Making

Management History

Planning and Control Techniques

Managing Operations

Filters

Exam 7: Decision Making

__________ occurs when decision makers incorrectly fixate on past expenditures of time, money, or effort in assessing choices rather than focusing on future consequences.

Highly reliable organizations (HROs) make decisions at the executive level.

Which of the following is a habit of successful highly reliable organizations (HROs)?

A policy __________.

A perfectly rational decision maker would __________.

Managers need to understand cultural differences to make effective decisions in today's fast-moving world.

One assumption of rationality is that time and cost constraints exist.

When the petty cash in Elaine's drawer falls to less than $25, she places a request for additional funds to bring the total back up to $100. This is an example of a(n) __________ decision.

"No smoking allowed" is an example of a __________.

Which of the following statements is true concerning problem identification?

Highly reliable organizations (HROs) tap into their complexity to help them adapt more effectively.

The assumption that managers make consistent, value-maximizing choices within specified constraints is known as which of the following?

A decision is a discrepancy between an existing and a desired state of affairs.

"We strive to use environmentally safe materials" is an example of a __________.

Introduction to Management and Organizations

Organizational Culture and the Organizational Environment

Managing in a Global Environment

Managing Entrepreneurially

Managing Responsibly and Ethically

Innovation and Adaptability

Foundations of Planning

Managing Strategically

Organizational Design

Managers and Communication

Managing Human Resources

Leadership

Motivating Employees

Managing Groups and Teams

Evidence-Based Decision Making

Management History

Planning and Control Techniques

Managing Operations

Filters