Fundamentals of Management, 7e (Robbins/DeCenzo/Coulter)

Chapter 3 Foundations of Decision Making

1) In decision making, a problem can be defined as a discrepancy between what exists and what
the problem solver desires to exist.
Answer: T!"
#) The second step in the decision$making process is identifying a problem.
Answer: %A&'"
() A decision criterion defines factors that are relevant in a decision.
Answer: T!"
)) *anagers identify a problem by comparing the c+rrent state of affairs to some standard.
Answer: T!"
,) All criteria are e-+ally important in the decision$making process.
Answer: %A&'"
.) Identifying the wrong problem is /+st as m+ch a fail+re for a manager as identifying the right
problem and failing to solve it.
Answer: T!"
0) The final step of the decision$making process is to implement the alternative that has been
selected.
Answer: %A&'"
1) A he+ristic can simplify the decision$making process.
Answer: T!"
2) 3eca+se he+ristics simplify the decision$making process, they are +nlikely to lead to errors.
Answer: %A&'"
14) 5ecision makers who 6cherry$pick6 information that matches what they already know are
g+ilty of confirmation bias.
Answer: T!"
11) A basketball coach who takes a very good shooter o+t of a game beca+se she missed her last
two shots has availability bias.
Answer: T!"
1#) A rational decision will never fail to provide the best and most s+ccessf+l sol+tion to a
problem.
Answer: %A&'"
1() *aximi7ing val+e means a decision will have the best possible o+tcome for the parties
involved.
Answer: T!"
1
8opyright 9 #411 :earson "d+cation, Inc
1)) ;ne ass+mption of bo+nded rationality is that managers can analy7e all relevant information
abo+t all alternatives for a sit+ation.
Answer: %A&'"
1,) A synonym for the word satisfice is maximize.
Answer: %A&'"
1.) ;ne ass+mption of bo+nded rationality is that managers +s+ally make rational decisions.
Answer: T!"
10) Int+itive decision making is systematic, logical, and orderly.
Answer: %A&'"
11) Int+itive decision making cannot be a part of the rational decision$making process.
Answer: %A&'"
12) The expression 6throwing good money after bad6 is an example of an escalation of
commitment.
Answer: T!"
#4) "motions sho+ld always be strictly ignored in a decision$making process.
Answer: %A&'"
#1) :rogrammed decisions tend to be ro+tine.
Answer: T!"
##) A r+le is simpler than a policy or a proced+re to implement.
Answer: T!"
#() Implementing a proced+re re-+ires more /+dgment and interpretation than implementing a
policy.
Answer: %A&'"
#)) A highway speed limit is an example of a policy.
Answer: %A&'"
#,) *anagerial decisions are likely to become more programmed as managers rise in an
organi7ational hierarchy.
Answer: %A&'"
#.) *ost managerial decisions incl+de an element of risk.
Answer: T!"
#0) !ncertainty involves a sit+ation in which the probability of a certain o+tcome is known to be
small.
Answer: %A&'"
#1) A manager is more confident of his assessment of a sit+ation if it involves risk rather than
+ncertainty.
Answer: T!"
#
8opyright 9 #411 :earson "d+cation, Inc
#2) <ro+p decisions tend to provide more complete information than individ+al decisions.
Answer: T!"
(4) An advantage of gro+p decisions is that they increase the perception of the legitimacy of the
sol+tion.
Answer: T!"
(1) A drawback of gro+p decision making is gro+pthink.
Answer: %A&'"
(#) <ro+ps tend to be more efficient and less effective than individ+al decision making.
Answer: T!"
(() Two ma/or advantages of electronic meetings are anonymity and honesty.
Answer: T!"
()) A co+ntry with high +ncertainty avoidance and high power distance is more likely to engage
in gro+pthink than a co+ntry with low +ncertainty avoidance and low power distance.
Answer: T!"
(,) 8reative sol+tions to problems are val+ed beca+se they are new and different from traditional
sol+tions.
Answer: %A&'"
(.) 5ecision making begins with ========.
A) selecting alternatives
3) identifying decision criteria
8) identifying a problem
5) eliminating false alternatives
Answer: 8
(0) >hich of the following defines a problem in the decision$making process?
A) a discrepancy between what exists and what the decision maker desires to exist
3) a discrepancy between the ideal and the practical
8) something that ca+ses irritation
5) something that calls for attention
Answer: A
(
8opyright 9 #411 :earson "d+cation, Inc
(1) The decision$making process consists of a series of eight steps that identify a problem and
work toward +ltimately ========.
A) determining if there is a sol+tion to the problem
3) solving the problem
8) making a plan to solve the problem
5) breaking down the problem into a series of steps
Answer: 3
(2) To identify a problem, a manager ========.
A) compares one set of standards or goals to a second set of standards or goals
3) looks for +nhappy c+stomers
8) +ses int+ition to see that things don@t look right
5) compares the c+rrent state of affairs with some standard or goal
Answer: 5
)4) A manager can faithf+lly exec+te the decision$making process, b+t still end +p with nothing
of val+e if ========.
A) he fails to identify the correct problem
3) he fails to assign n+mber val+es to different criteria
8) he solves the problem inefficiently
5) he fails to correctly identify the steps of the process
Answer: A
)1) A manager is considering p+rchasing new comp+ters for her department. The manager
spends time assessing the comp+ters her department now has. >hich stage of the decision$
making process is she going thro+gh?
A) identification of a problem
3) identification of decision criteria
8) development of alternatives
5) implementation of an alternative
Answer: A
)#) A manager is determining what kind of new comp+ters she sho+ld p+rchase for her
department. 'he has made a list of five different comp+ter models for consideration. >hich stage
of the decision$making process is this?
A) selection of an alternative
3) identification of decision criteria
8) development of alternatives
5) analysis of alternatives
Answer: 8
)
8opyright 9 #411 :earson "d+cation, Inc
)() After p+rchasing new comp+ters for her department, a manager is now comparing the
performance of the new comp+ters to the comp+ters they replaced. >hich stage of the decision$
making process is she carrying o+t?
A) analysis of alternatives
3) eval+ation of decision effectiveness
8) selection of an alternative
5) implementation of an alternative
Answer: 3
))) %or a high$tech bicycle b+yer, decision criteria wo+ld be determined by ========.
A) whatever most bike b+yers recommend
3) expert ratings in bike maga7ines
8) technical specifications
5) personal preferences of the b+yer
Answer: 5
),) >hich of the following is &"A'T likely to be a decision criterion for a high$tech bicycle
b+yer who cares primarily abo+t performance?
A) warranty
3) gear mechanism
8) frame composition
5) brake assembly
Answer: A
).) >hich of the following wo+ld be a fairly ob/ective criterion by which a bicycle b+yer co+ld
assess different bike models?
A) handling
3) weight
8) -+ality of craftsmanship
5) style
Answer: 3
)0) A manager chooses to ignore a rigoro+s decision$making process and select TA monitor A
over monitor 3 beca+se he 6tr+sts6 company A more than company 3. If the decision he made
was rational, which of the following is tr+e?
A) *onitor A is really the better choice.
3) The manager sho+ld have incl+ded 6tr+st6 as a criterion.
8) *onitor 3 is really the better choice.
5) The manager m+st have made a mistake in calc+lating his weighted criteria.
Answer: 3
)1) In allocating weights to the decision criteria, which of the following is most helpf+l to
remember?
A) All weights m+st be the same.
3) The total of the weights m+st s+m to 144.
8) The high score sho+ld be a 14, and no two criteria sho+ld be assigned the same weight.
5) Assign the most important criterion a score, and then assign weights against that standard.
Answer: 5
,
8opyright 9 #411 :earson "d+cation, Inc
)2) >hat is a he+ristic?
A) a complicated and systematic method of decision making
3) a p+rely int+itive method of decision making
8) a totally +nreliable method of decision making
5) a shortc+t or r+le of th+mb that is +sed for decision making
Answer: 5
,4) 3eca+se they are not systematic or comprehensive, +sing he+ristics in place of an eight$step
decision$making process can lead to ========.
A) errors and biases
3) consistently better decisions
8) more imaginative decisions
5) decisions that more directly solve problems
Answer: A
,1) >hich of the following is B;T a reason why managers often resort to +sing he+ristics?
A) They seem to eliminate complexity.
3) They seem to eliminate ambig+ity.
8) They save time.
5) They thoro+ghly explore all alternatives.
Answer: 5
.
8opyright 9 #411 :earson "d+cation, Inc
,#) A banker opts for short$term gain despite indications that his decision might not pay off in
the long r+n. >hich error or bias is the banker g+ilty of?
A) overconfidence
3) immediate gratification
8) selective perception bias
5) representation
Answer: 3
,() A scientist cites two st+dies that show a positive effect for her dr+g and ignores five other
st+dies that show a negative effect. >hich error or bias is she committing?
A) hindsight
3) anchoring effect
8) confirmation bias
5) self$serving
Answer: 8
,)) ;ne legislator sees decreased tax reven+e as the key problem in the b+dget. A second
legislator sees increased spending as the problem. "ach of these legislators has aCn) ========.
A) representation bias
3) self$serving bias
8) availability bias
5) framing bias
Answer: 5
,,) >hich of the following is B;T a common decision$making error or bias?
A) s+nk costs
3) randomness
8) forest for the trees
5) overconfidence bias
Answer: 8
,.) The three main models that managers +se to make decisions are ========.
A) rational, bo+nded rational, and int+itive
3) rational, irrational, bo+nded rational
8) int+itive, +nint+itive, rational
5) bo+nded rational, int+itive, systematic
Answer: A
,0) It is ass+med that a rational decision maker ========.
A) wo+ld never make a wrong choice
3) wo+ld be s+b/ective and impractical
8) wo+ld face only diffic+lt decisions
5) wo+ld be ob/ective and logical
Answer: 5
0
8opyright 9 #411 :earson "d+cation, Inc
,1) >hat does it mean for a decision maker to maximi7e val+e?
A) to make the decision to be as clear and logical as possible
3) to make the achievement of goals as likely as possible
8) to waste as little time and energy as possible
5) to make decision making as simple as possible
Answer: 3
,2) *aximi7ing val+e for an organi7ation means making s+re that ========.
A) the organi7ation makes money
3) the best interests of the organi7ation are addressed
8) the decision made is as rational as possible
5) the decision is as simple as possible
Answer: 3
.4) >hich of the following is B;T ass+med in a rational decision?
A) a clear and specific goal
3) a clear and +nambig+o+s problem
8) many alternatives and conse-+ences are known
5) val+e is maximi7ed
Answer: 8
.1) It is ass+med that in most cases, the decisions of all managers are limited by ========.
A) greed and short$sightedness
3) having too m+ch information
8) not being able to analy7e all information for all alternatives
5) not being able to act rationally or in the best interests of their organi7ation
Answer: 8
.#) >hich term best characteri7es a decision that has bo+nded rationality?
A) virt+ally perfect
3) rigoro+s and comprehensive
8) not good eno+gh
5) good eno+gh
Answer: 5
.() 'oftware programs that +se a series of -+estions to aid h+mans in decision making are called
========.
A) text reading software
3) expert systems
8) gro+p systems
5) s+pport software
Answer: 3
.)) "xpert systems are primarily +sed to help what kinds of decision makers?
A) lower$level managers
3) top managers
8) senior managers
5) experts
Answer: A
1
8opyright 9 #411 :earson "d+cation, Inc
.,) Be+ral networks are able to o+tdo the performance of h+mans by ========.
A) analy7ing symbols
3) handling +p to three variables at once
8) handling h+ndreds of variables at once
5) reading facial expressions
Answer: 8
..) Be+ral networks differ from expert systems in that they can ========.
A) draw concl+sions from data
3) ask -+estions to the decision maker
8) perform sophisticated calc+lations
5) learn from experience
Answer: 5
.0) Be+ral networks o+tperfom expert systems in +ncovering ========.
A) credit card fra+d
3) false positives for pregnancy
8) potential credit card c+stomers
5) credit problems in bank mortgages
Answer: A
.1) Derbert 'imon won the Bobel :ri7e in economics for his work in describing ========.
A) how people spend money
3) how most people are perfectly rational
8) how people make decisions
5) how people avoid decisions
Answer: 8
.2) >hich of the following is the best definition for the word satisfice?
A) very satisfying
3) not s+fficient
8) accepts a less than perfect sol+tion
5) re-+ires a perfect sol+tion
Answer: 8
04) 'imon fo+nd that in making decisions, most people satisficed beca+se they had limited
ability to ========.
A) be tr+thf+l and honest in sit+ations that deal with other people
3) think independently
8) deal with diffic+lt sit+ations
5) grasp present conditions and anticipate f+t+re conditions
Answer: 5
01) A person who satisfices fails to ========.
A) maximi7e his or her decision
3) +nderstand his or her position
8) accept the tr+th of a sit+ation
5) make any kind of decision
Answer: A
2
8opyright 9 #411 :earson "d+cation, Inc
0#) 'ticking to a decision despite evidence that it is a mistake is called ========.
A) escalation of commitment
3) escalation of rationality
8) satisficing commitment
5) error enhancement
Answer: A
0() "scalation of commitment can occ+r when people don@t ========.
A) want to make a decision
3) want to admit that an earlier decision was flawed
8) accept c+rrent conditions
5) +nderstand that conditions have changed
Answer: 3
0)) >hich model of decision making takes advantage of +nconscio+s reasoning?
A) rational
3) non$rational
8) int+itive
5) fact+al
Answer: 8
0,) 8ompared to f+lly rational decision making, what is a ma/or advantage of int+itive decision
making?
A) total reliability
3) f+lly -+antified
8) thoro+ghness
5) speed
Answer: 5
0.) Dow often do managers typically +se int+itive decision making?
A) 144 percent of the time
3) almost never
8) almost all of the time
5) more than half of the time
Answer: 5
00) Int+itive decision making can complement ========.
A) rational decision making only
3) bo+nded rationality only
8) both rationality and bo+nded rationality
5) neither rationality nor bo+nded rationality
Answer: 8
01) >hich of the following is B;T a way in which int+ition g+ides people who are making
decisions?
A) Int+ition provides ethics and val+es g+idelines.
3) Int+ition provides a formal analysis method.
8) Int+ition provides experiences to draw from.
5) Int+ition draws on knowledge, skills, and training.
Answer: 3
14
8opyright 9 #411 :earson "d+cation, Inc
02) "motions and feelings ======== decision making.
A) have no effect on
3) can improve
8) decrease performance in
5) are more important than facts and logic in
Answer: 3
14) 'tr+ct+red problems are ========.
A) ambig+o+s
3) +ndefined and vag+e
8) clear and straightforward
5) incomplete
Answer: 8
11) !nstr+ct+red problems are ========.
A) perfectly rational
3) clear and straightforward
8) sit+ations in which all options are known
5) sit+ations in which all options are not known
Answer: 5
1#) >hich of the following is an example of a str+ct+red problem?
A) designing a new *:( player
3) hiring a lawyer
8) deciding shipping options for a vac++m cleaner
5) drafting a -+arterback for a pro football team
Answer: 8
1() >hich of the following is an example of an +nstr+ct+red problem?
A) finding the list price of different copy machines
3) choosing the best wardrobe for an exec+tive
8) comparing gas mileage for different car models
5) meas+ring poll+tion levels in a power plant
Answer: 3
1)) 'tr+ct+red problems typically have ======== while +nstr+ct+red problems typically have
========.
A) only one sol+tionE many sol+tions
3) many sol+tionsE one sol+tion
8) many sol+tionsE fewer sol+tions
5) two sol+tionsE three sol+tions
Answer: A
11
8opyright 9 #411 :earson "d+cation, Inc
1,) :rogrammed decisions work well for solving ========.
A) str+ct+red problems
3) +nstr+ct+red problems
8) both str+ct+red and +nstr+ct+red problems
5) poorly defined problems
Answer: A
1.) :rogrammed decisions draw heavily on which of the following?
A) mistakes made in the past
3) past sol+tions that were s+ccessf+l
8) past sol+tions that were +ns+ccessf+l
5) innovative new sol+tions
Answer: 3
10) >hich of the following is B;T a type of programmed decision?
A) systematic proced+re
3) policy
8) brainstorm
5) r+le
Answer: 8
11) %ollowing the directions to p+t together an elliptical exercise machine is an example of
which way to solve a problem?
A) proced+re
3) r+le
8) general practice
5) policy
Answer: A
12) A football coach makes the decision to p+nt or not to p+nt on fo+rth down based on whether
or not he is past his own ,4$yard line. >hich decision$making method does the coach +se?
A) a policy
3) a h+nch
8) a proced+re
5) a r+le
Answer: 5
24) >hich pair or pairs of terms is tr+e? CThis -+estion can have more than one correct answer.)
A) str+ct+red problem, programmed decision
3) str+ct+red problem, str+ct+red decision
8) +nstr+ct+red problem, programmed decision
5) +nstr+ct+red problem, nonprogrammed decision
Answer: A, 5
1#
8opyright 9 #411 :earson "d+cation, Inc
21) A /+dge cons+lts g+idelines before handing down an award for damages in a legal case. >hat
kind of decision making is she doing?
A) following a policy
3) following a r+le
8) programmed
5) following a proced+re
Answer: A
2#) Top managers in an organi7ation tend to ========.
A) make programmed decisions
3) solve str+ct+red problems
8) make nonprogrammed decisions
5) solve well$defined problems
Answer: 8
2() >hich three conditions do decision makers face?
A) certainty, risk, +ncertainty
3) certainty, +ncertainty, confidence
8) risk, high risk, low risk
5) certainty, risk, high risk
Answer: A
2)) In a condition of certainty, ========.
A) most o+tcomes are known
3) the decision is already made
8) all o+tcomes of all alternatives are known
5) some alternatives are not known
Answer: 8
2,) If a car b+yer knows the inventory dealer price of the same car at different dealerships, he or
she is operating +nder what type of decision$making condition?
A) risk
3) +ncertainty
8) certainty
5) fact+al
Answer: 8
2.) A retail clothing store manager who estimates how m+ch to order for the c+rrent spring
season based on last spring@s o+tcomes is operating +nder what kind of decision$making
condition?
A) seasonal
3) risk
8) +ncertainty
5) certainty
Answer: 3
1(
8opyright 9 #411 :earson "d+cation, Inc
20) ======== is a sit+ation in which a decision maker has only incomplete information abo+t
o+tcomes and does not have ability to reasonably estimate o+tcomes that are not known.
A) 8ertainty
3) isk
8) !ncertainty
5) Digh certainty
Answer: 8
21) A low$level manager is most likely to solve problems +nder which condition?
A) certainty
3) low risk
8) +ncertainty
5) low certainty
Answer: A
22) A top manager is most likely to solve problems +nder which condition?
A) certainty
3) risk
8) +ncertainty
5) high certainty
Answer: 8
144) A manager has a choice of three investment f+nds. To assess them, he looks at their past
investment records over the previo+s five years. The manager is operating +nder which
condition?
A) certainty
3) probability
8) +ncertainty
5) risk
Answer: 5
141) A manager has a choice of three bank 85s that pay different amo+nts of interest over
different time periods. The manager is operating +nder which condition?
A) /eopardy
3) certainty
8) +ncertainty
5) risk
Answer: 3
14#) A manager wants to invest in one of three start$+p companies. All three of the companies
seem to have a good b+siness plan. Bone of the companies has a track record. The manager is
operating +nder which condition?
A) +ncertainty
3) certainty
8) low certainty
5) risk
Answer: A
1)
8opyright 9 #411 :earson "d+cation, Inc
14() A key to what is commonly +sed to assess risk is for a decision maker to examine the
======== an investment.
A) the promises made by a company for
3) the ads posted by a company for
8) historical data for
5) the minor details of
Answer: 8
14)) *anagers in organi7ations make gro+p decisions ========.
A) fre-+ently
3) never
8) almost never
5) rarely
Answer: A
14,) The eight steps of decision making ========.
A) can only be employed by individ+als
3) can only be employed in very small gro+ps
8) can be employed by individ+als and gro+ps
5) can only be employed by gro+ps
Answer: 8
14.) ;ne advantage of gro+p decision making is that it +s+ally provides ======== than
individ+al decision making.
A) faster decisions
3) more ethical decisions
8) less conf+sion
5) more information
Answer: 5
140) <ro+p decisions generally feat+re ======== acceptance than decisions made by an
individ+al.
A) greater
3) less
8) neither greater or less
5) more enth+siastic
Answer: A
141) <ro+p decision making typically increases the legitimacy of a decision beca+se the decision
was made ========.
A) over a long period of time
3) democratically
8) by experts
5) primarily by the gro+p leader
Answer: 3
1,
8opyright 9 #411 :earson "d+cation, Inc
142) 5ecisions made by individ+als typically s+ffer from s+spicions that the decision maker
========.
A) is dishonest
3) is not rational
8) did not try to analy7e the sit+ation
5) did not cons+lt all interested parties
Answer: 5
114) 'eeking the views of a diverse gro+p of people can provide a decision maker with
======== on iss+es.
A) fresh perspectives
3) conventional wisdom
8) +niversal agreement
5) a foolproof way to get the perfect answer
Answer: A
111) >hich of the following is a drawback to seeking diverse views in decision making?
A) less reliable decision
3) easier decision$making process
8) more time cons+ming
5) less time cons+ming
Answer: 8
11#) >hich phrase best s+mmari7es the drawbacks of gro+p decisions?
A) A camel is a racehorse p+t together by a manager.
3) A camel is a racehorse p+t together by a committee.
8) A camel is a no racehorse when it comes to speed.
5) A camel beats a racehorse in a long race.
Answer: 3
11() <ro+ps decisions are +s+ally ======== individ+al decisions.
A) more efficient than
3) less efficient than
8) e-+al in efficiency to
5) more efficient b+t less effective
Answer: 3
11)) 'ince all members of a gro+p are rarely e-+al in stat+s, most gro+ps s+ffer from ========.
A) minority domination
3) ma/ority domination
8) too m+ch diversity
5) gridlock
Answer: A
1.
8opyright 9 #411 :earson "d+cation, Inc
11,) ======== can ca+se people in a gro+p to fail to express their tr+e opinions.
A) Ambig+o+s responsibility
3) <ro+p imbalance
8) :ress+re to conform
5) Fears of experience
Answer: 8
11.) >hich of the following is a primary characteristic of gro+pthink?
A) conflict among gro+p members
3) fail+re to reach consens+s within a gro+p
8) complete conformity among gro+p members
5) a gro+p that is candid and open
Answer: 8
110) >hich of the following is B;T a factor that can increase the probability of gro+pthink?
A) Infl+ential gro+p members dominate the disc+ssion and the decision$making process.
3) <ro+p leaders stress the importance of consens+s above all other concerns.
8) The gro+p has more than )4 gro+p members.
5) <ro+p leaders solicit ideas from all gro+p members witho+t passing /+dgment on their ideas.
Answer: 5
111) >hich of the following is the most effective n+mber of people to have in a gro+p?
A) ,$0
3) #$)
8) 14$1,
5) 1.$#,
Answer: A
112) >hich of the following is +sed to excl+sively generate creative ideas in a gro+p setting?
A) brainstorming
3) nominal gro+p techni-+e
8) gro+pthink
5) electronic meetings
Answer: A
1#4) >hich of the following is B;T allowed in a brainstorming session?
A) clear definition of the problem
3) criticism or dismissal of poor ideas
8) large n+mber of alternatives
5) recording of all alternatives
Answer: 3
1#1) >hich of the following gro+p techni-+es allows gro+p members to meet together, b+t at the
same time facilitates independent decision making?
A) brainstorming
3) nominal gro+p techni-+e
8) large meetings of over ,4 individ+als
5) small meetings of less than 14 individ+als
Answer: 3
10
8opyright 9 #411 :earson "d+cation, Inc
1##) The ======== blends the nominal gro+p techni-+e with sophisticated comp+ter technology.
A) personal meeting
3) electronic meeting
8) virt+al meeting
5) preliminary meeting
Answer: 3
1#() >hat advantages does videoconferencing provide for gro+p decision making?
A) anonymo+s expression of opinions
3) less gro+pthink
8) less minority domination
5) savings on travel and time
Answer: 5
1#)) *id$level managers in a co+ntry with high power distance are ======== than managers
from a low power distance co+ntry.
A) more likely to make risky decisions
3) less likely to make risky decisions
8) less likely to make safe, conservative decisions
5) more likely to disagree with their leaders@ decisions
Answer: 3
1#,) *id$level managers in a co+ntry with low +ncertainty avoidance are ======== than
managers from a high +ncertainty avoidance co+ntry.
A) more likely to make risky decisions
3) less likely to make risky decisions
8) less likely to make foolish decisions
5) more likely to avoid making decisions
Answer: A
1#.) Individ+alistic co+ntries like the !nited 'tates tend to have ======== than gro+p$oriented
co+ntries like Gapan.
A) more conformity and more cooperation
3) more conformity and less cooperation
8) less conformity and more cooperation
5) less conformity and less cooperation
Answer: 5
1#0) The +se of ringisei in Gapanese organi7ations reflects which of the following val+es in
Gapanese c+lt+re?
A) tradition$following
3) consens+s$seeking
8) risk taking
5) go$it$alone
Answer: 3
11
8opyright 9 #411 :earson "d+cation, Inc
1#1) %rench management style tends to be ======== in style.
A) permissive
3) gro+p oriented
8) r+le following
5) a+tocratic
Answer: 5
1#2) >hen dealing with international organi7ations, managers m+st be ======== in order to
accommodate the managing styles of different c+lt+res.
A) as flexible as possible
3) as inflexible as possible
8) as strict as possible
5) as thoro+gh
Answer: A
1(4) ======== helps people find better sol+tions to problems +sing innovative problem$solving
methods.
A) :lanning
3) 8reativity
8) ;rgani7ation
5) 'tr+ct+re
Answer: 3
1(1) According to one st+dy, abo+t ======== of men and women were somewhat creative.
A) 1 percent
3) 14 percent
8) (4 percent
5) .4 percent
Answer: 5
1(#) ;ne well$accepted model states that individ+al creativity re-+ires ========, or a
commanding +nderstanding of a s+b/ect matter.
A) expertise
3) task motivation
8) high interest
5) int+ition
Answer: A
1(() >hich of the following is B;T a characteristic of a creative problem solver?
A) self confidence
3) tolerance for ambig+ity
8) fr+strates easily
5) accepts risks readily
Answer: 8
12
8opyright 9 #411 :earson "d+cation, Inc
1()) >hich of the following traits do all creative people seem to share?
A) They like to save time.
3) They get along well with others.
8) They love their work.
5) They don@t like to work hard.
Answer: 8
1(,) >hich of the following tends to impede a person@s creativity?
A) providing time and reso+rces
3) clearly defined goals
8) being watched while yo+ work
5) internal motivation
Answer: 8
5ecisions, 5ecisions C'cenario)
'ondra needed help. Der ins+rance company@s rapid growth was necessitating making some IT
changes, b+t what changes? 'ho+ld they modify the servers that they c+rrently +sed, or p+rchase
an entirely new system? 'ondra was conf+sed and needed help in making the correct decision.
1(.) According to the decision$making process, the first step 'ondra sho+ld take is to ========.
A) analy7e alternative sol+tions
3) identify decision criteria
8) eval+ate her decision@s effectiveness
5) identify the problem
Answer: 5
1(0) 'ondra has decided to collect information abo+t the feat+res the company needs for its
system. >hich stage of the decision$making process is she carrying o+t?
A) identify alternative sol+tions
3) identify decision criteria
8) eval+ate her decision@s effectiveness
5) allocate weights to the criteria
Answer: 3
1(1) 'ondra has determined that the speed of the system she settles on is twice as important as
the capacity of the system. >hich stage of the decision$making process is she carrying o+t?
A) allocation of weights to criteria
3) selecting an alternative
8) implementing the alternative
5) identifying the problem
Answer: A
#4
8opyright 9 #411 :earson "d+cation, Inc
1(2) 'ondra has decided to p+rchase a new system. After obtaining permission, she has ordered
the system from a rep+table company. >hich stage of the decision$making process is she
carrying o+t in making the order?
A) analy7ing alternative sol+tions
3) selecting an alternative
8) implementing the alternative
5) identifying the problem
Answer: 8
1)4) The very last step 'ondra sho+ld take, according to the decision$making process, is to
========.
A) analy7e alternative sol+tions
3) select alternatives
8) implement the alternative
5) eval+ate the decision@s effectiveness
Answer: 5
1)1) In a short essay, list and disc+ss the first fo+r steps in the decision$making process. <ive an
example of each step.
Answer:
'tep 1: Identification of a problem
The decision$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.
'tep #: Identification of decision criteria
;nce the manager has identified a problem that needs attention, the decision criteria important to
resolving the problem m+st be identified. That is, managers m+st determine what factors are
relevant in making a decision. An example of identifying decision criteria is deciding what
feat+res yo+ need in a new car.
'tep (: Allocation of weights to the criteria
At this step, the decision maker m+st compare the items in order to give them the correct priority
in the decision. The most important criterion is assigned the heaviest weight. ;ther criteria are
assigned weights in comparison with that standard. >eights can be -+antitativeHwith n+mber
val+esHor determined on a -+alitative scale. An example of weighting decision criteria is
ranking the feat+res of a new car in order of their importance.
'tep ): 5evelopment of alternatives
The fo+rth step re-+ires the decision maker to +se 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.
#1
8opyright 9 #411 :earson "d+cation, Inc
1)#) In a short essay, list and disc+ss the final fo+r steps in the decision$making process. <ive an
example of each step.
Answer:
'tep ,: Analysis of alternatives
;nce the alternatives have been identified, the decision maker m+st critically analy7e each
alternative. %rom this comparison, the strengths and weaknesses of each alternative become
evident. An example of analy7ing alternatives is to make a table of weighted scores for possible
new cars.
'tep .: 'election of an alternative
The sixth step is the important act of choosing the best alternative from among those considered.
All the pertinent factors sho+ld be considered here, both ob/ective and s+b/ective. Then a choice
of a single alternativeHor gro+p of alternativesHsho+ld be selected. An example of selecting an
alternative is to choose a single new car from a list of alternatives.
'tep 0: Implementation of the alternative
Implementation involves carrying o+t the decision that was made. In the car example, it involves
p+rchasing the car that was selected.
'tep 1: "val+ation of decision effectiveness
The last step in the decision$making process involves appraising the o+tcome of the decision to
see if the problem has been resolved. 5id the alternative chosen and implemented accomplish the
desired res+lt? If not, the decision maker may consider ret+rning to a previo+s step or may even
consider starting the whole decision process over. An example of this final step wo+ld be to
assess the s+ccess of the car$b+ying decision. >as the right car selected? 5id it have all of the
feat+res and characteristics that were needed? 5id it perform all of the f+nctions that were
needed?
##
8opyright 9 #411 :earson "d+cation, Inc
1)() In a short essay, disc+ss why creativity is important to decision making. 5escribe a sit+ation
in which a creative sol+tion is +sed to solve a problem.
Answer: 8reativity is important to decision making beca+se it allows managers to solve
problems in more efficient, effective, and innovative ways. Innovation is val+able beca+se it can
open +p new paths of exploration for an organi7ation, sometimes exposing needs that weren@t
known abo+t and possible opport+nities that weren@t s+spected.
An example of a creative sol+tion to a problem is the recent development of a software bowling
game for senior citi7ens. ather than try to develop a new game for children or yo+ng ad+ltsH
two fairly sat+rated marketsHthe company t+rned its attention to a neglected market, senior
citi7ens. 8o+ld the company get seniorsHwho typically don@t +se comp+tersHto play video
games? They co+ld if they created the right game.
The company worked hard to develop a program that was 6friendly6 to its typical +serHa senior
citi7en who had no comp+ter skills or knowledge. The res+lt was a h+ge hit. 'eniors all over the
!nited 'tates now rave abo+t this f+n new game. &eag+es have formed. To+rnaments have been
organi7ed. 'eniors especially en/oy the fact that they can play the game at home, and that
physical disabilities don@t prevent them from playing. The s+ccess of the game is a good example
of how being creative can solve a problem.
1))) In a short essay, disc+ss bo+nded rationality and satisficing.
Answer: :erfect rationality re-+ires that the decision maker face a clear and +nambig+o+s
problem with a clear and specific goal and have knowledge of all possible alternatives for his or
her decision, and all o+tcomes and conse-+ences that res+lt from choosing each one of those
alternatives. In the real world, these conditions are almost never met. ather than address the
virt+ally impossible chore of identifying all alternatives and o+tcomes of the decision, the
decision maker chooses to apply bo+nded rationality, which limits the scope of the decision to
/+st some, rather than all alternatives and conse-+ences. 3o+nded rationality re-+ires the
decision maker to satisfice, or choose a 6good eno+gh6 sol+tion to the problem rather than
maximi7e his or her decision by identifying the perfect rational sol+tion.
#(
8opyright 9 #411 :earson "d+cation, Inc
1),) In a short essay, disc+ss the differences among a proced+re, a r+le, and a policy. Incl+de
specific examples of each to s+pport yo+r answer.
Answer: A proced+re is a series of se-+ential steps that a manager can +se for responding to a
well$str+ct+red problem. An example of a proced+re are instr+ctions for how to install a new
thermostat for yo+r home heating system. Fo+ follow the instr+ctions in a step$by$step manner to
remove the old thermostat and install the new one.
A r+le is an explicit statement that tells a manager what he or she can or cannot do. *anagers
fre-+ently +se r+les when they confront a well$str+ct+red problem beca+se r+les are simple to
follow and ens+re consistency. %or example, a r+le at a local tennis cl+b might dictate that if the
co+rts are f+ll, players can play no longer than one ho+r. >hen their ho+r is +p they can get
b+mped from their co+rt.
A policy provides g+idelines to channel a manager@s thinking in a specific direction. In contrast
to a r+le, a policy establishes parameters for the decision maker rather than specifically stating
what sho+ld or sho+ld not be done. :olicies differ from proced+res in that they typically leave
-+ite a bit of interpretation +p to the decision maker. An example of a policy is g+idelines that
re-+ire scientists at a research lab have an advanced degree in their field, at least three years of
post$doctoral work, and at least five p+blished scientific papers to their credit. These
re-+irements are g+idelinesHcandidates who lack all of the -+alifications b+t have other
strengths may also be considered for the /ob. It wo+ld be +p to the decision maker to determine
how rigoro+sly the policy wo+ld be followed.
#)
8opyright 9 #411 :earson "d+cation, Inc
1).) In a short essay, identify and explain the advantages and disadvantages to gro+p decision
making.
Answer: <ro+p decisions provide more complete information than do individ+al ones, as a
gro+p will bring a diversity of experiences and perspectives to the decision process that an
individ+al acting alone cannot. In addition, beca+se gro+ps have a greater -+antity and diversity
of information, they can identify more alternatives than can an individ+al. %+rthermore, gro+p
decision making increases acceptance of a sol+tion. %inally, the gro+p decision$making process
is consistent with democratic idealsE therefore, decisions made by gro+ps may be perceived as
more legitimate than decisions made by a single person.
<ro+p decisions are not witho+t their drawbacks. It takes time to assemble a gro+p and the
interaction that takes place once the gro+p is in place is fre-+ently inefficient. <ro+ps almost
always take more time to reach a sol+tion than an individ+al wo+ld take to make the decision
alone. <ro+ps may also be s+b/ect to minority domination, in which one or a few gro+p members
compel others to adhere to their agenda.
Another problem is the press+re to conform in gro+ps. In gro+pthink, a form of conformity,
gro+p members withhold their views in order to avoid controversy, avoid taking responsibility
for their actions, and give the appearance of agreement. As a res+lt, gro+pthink +ndermines
critical thinking in the gro+p and event+ally harms the -+ality of the final decision. And, finally,
ambig+o+s responsibility can become a problem. <ro+p members share responsibility, so the
responsibility of any single member is watered down and no one ends +p taking 6ownership6 of
the gro+p@s final decision.
1)0) In a short essay, describe how brainstorming can help avoid gro+pthink and enhance
creativity in gro+p decision making.
Answer: 3rainstorming is a relatively simple techni-+e for overcoming the press+res for
conformity that retard the development of creative alternatives. 3rainstorming +tili7es an idea$
generating process that specifically enco+rages any and all alternatives while withholding any
criticism of those alternatives. In a typical brainstorming session, participants 6freewheel6 as
many alternatives as they can in a given time. Bo criticism is allowed, and all the alternatives are
recorded for later disc+ssion and analysis.
#,
8opyright 9 #411 :earson "d+cation, Inc
1)1) In a short essay, describe how nominal gro+p techni-+e can help avoid gro+pthink and
enhance creativity in gro+p decision making.
Answer: Bominal gro+p techni-+e helps gro+ps arrive at a satisfactory sol+tion to a problem.
The techni-+e restricts disc+ssion d+ring the decision$making process. <ro+p members m+st be
present, as in a traditional committee meeting, b+t they are re-+ired to operate independently.
They secretly write a list of general problem areas or potential sol+tions to a problem. The chief
advantage of this techni-+e is that it permits the gro+p to meet formally b+t does not restrict
independent thinking, as so often happens in the traditional interacting gro+p. 'ince opinions are
expressed anonymo+sly, participants are more candid, honest, creative, and ambitio+s with their
comments and s+ggestions.
1)2) In a short essay, describe how electronic meetings can help avoid gro+pthink and enhance
creativity in gro+p decision making.
Answer: The most recent approach to gro+p decision making blends the nominal gro+p
techni-+e with sophisticated comp+ter technology. It is called the electronic meeting. ;nce the
technology for the meeting is in place, the concept is simple. :articipants sit aro+nd a horseshoe$
shaped table that is empty except for a series of comp+ter terminals. Iss+es are presented to the
participants, who type their responses onto their comp+ter screens. Individ+al comments, as well
as aggregate votes, are displayed on a pro/ection screen in the room. The ma/or advantages of
electronic meetings are anonymity, honesty, and speed.
1,4) In a short essay, disc+ss the ass+mptions of rationality and the validity of those
ass+mptions.
Answer: A decision maker who was perfectly rational wo+ld be f+lly ob/ective and logical. De
or she wo+ld caref+lly define a problem and wo+ld have a clear and specific goal. *oreover,
making decisions +sing rationality wo+ld consistently lead toward selecting the alternative that
maximi7es the likelihood of achieving that goal.
The ass+mptions of rationality apply to any decision. ational managerial decision making
ass+mes that decisions are made in the best economic interests of the organi7ation. That is, the
decision maker is ass+med to be maximi7ing the organi7ation@s interests, not his or her own
interests.
*anagerial decision making can follow rational ass+mptions if the following conditions are met:
the manager is faced with a simple problem in which the goals are clear and the alternatives
limitedE the time press+res are minimalE and the cost of seeking o+t and eval+ating alternatives is
low. Dowever, most decisions that managers face in the real world don@t meet all of those tests.
#.
8opyright 9 #411 :earson "d+cation, Inc