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 !" "xplanation: A problem is a difference between a desired state and an existing state. #or example, s$ppose a person is h$ngry%the existing state of not having food. The desired state is to obtain food. &o the problem is defined as the difference between the no'food state and the food state. (iff: ) *age ef: +, -b.ective: /.1 )) The second step in the decision'making process is identifying a problem. Answer: #A0&" "xplanation: The identification of a problem is the first step in the decision'making process. -nce yo$ have identified a problem, yo$ can decide how to solve it. (iff: 1 *age ef: +1 -b.ective: /.1 /) A decision criterion defines factors that are relevant in a decision. Answer: T !" "xplanation: (ecision criteria are comprised of factors that will affect a decision. If the decision is between driving or riding a bike to work, criteria might incl$de cost, weather, convenience, ecological considerations, time, clothing, and so on. (iff: ) *age ef: +1 -b.ective: /.1 2) 3anagers identify a problem by comparing the c$rrent state of affairs to some standard. Answer: T !" "xplanation: The standard for comparison might be a goal that has been set, or comparison with some historical standard or standard set by a competitor. #or example, a manager might detect a discrepancy between a goal of 144 $nits sold and the existing state of only +4 $nits sold. This discrepancy constit$tes a problem that m$st be solved. (iff: / *age ef: +1 -b.ective: /.1 +) All criteria are e5$ally important in the decision'making process. Answer: #A0&" "xplanation: 6riteria have differing val$es, depending on their importance. The importance of an individ$al criterion is indicated by how it is weighted. The greater the weight assigned to the criterion, the greater its importance. (iff: ) *age ef: +1 AA6&7: Analytic &kills -b.ective: /.1

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9) Identifying the wrong problem is .$st as m$ch a fail$re for a manager as identifying the right problem and failing to solve it. Answer: T !" "xplanation: *roblem identification is a critical part of problem solving and decision making. &olving the wrong problem does nothing to f$rther a manager:s goals so it is no val$e. (iff: ) *age ef: +1 AA6&7: Analytic &kills -b.ective: /.1 ;) The final step of the decision'making process is to implement the alternative that has been selected. Answer: #A0&" "xplanation: Implementation of the best alternative is the second'to'last step in the process. The final step of the process is to appraise the res$lt of the decision to see if it solved the problem. (iff: 1 *age ef: 91 -b.ective: /.1 ,) A he$ristic can simplify the decision'making process. Answer: T !" "xplanation: A he$ristic is a r$le of th$mb that is $sed to simplify the decision'making process by allowing the decision maker to foc$s on .$st a few variables, rather than all variables. <hen $sed wisely, he$ristics make decision making easier and simpler. (iff: 1 *age ef: 9) -b.ective: /.1 1) 7eca$se he$ristics simplify the decision'making process, they are $nlikely to lead to errors. Answer: #A0&" "xplanation: 7y virt$e of their simplicity, he$ristics can lead to many different kinds of biases and errors. !sing he$ristics l$res decision makers into ignoring critical elements of the sit$ation and oversimplifying the problem. (iff: 1 *age ef: 9) AA6&7: Analytic &kills -b.ective: /.1 14) (ecision makers who =cherry'pick= information that matches what they already know are g$ilty of confirmation bias. Answer: T !" "xplanation: 6onfirmation bias means that the decision maker has already made $p his or her mind and is seeking only the information that will confirm that position. 6herry'picking is a way of preferentially selecting information that s$pports yo$r position and ignoring all other information. (iff: 1 *age ef: 9) AA6&7: Analytic &kills -b.ective: /.1

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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 !" "xplanation: Availability bias is the tendency to over'accent$ate recent history and disco$nt long'term patterns. This basketball coach is ignoring long'term patterns%the player is a good shooter%in favor of very recent history%two missed shots%so he is displaying availability bias. (iff: 1 *age ef: 9/ AA6&7: Analytic &kills -b.ective: /.1 1)) A rational decision will never fail to provide the best and most s$ccessf$l sol$tion to a problem. Answer: #A0&" "xplanation: A rational decision is logical, ob.ective and will maximi>e the likelihood of solving a problem or achieving a goal. That said, a decision can be arrived at thro$gh a rational process and still be wrong d$e to the decision maker lacking complete information abo$t the sit$ation. (iff: / *age ef: 92 AA6&7: Analytic &kills -b.ective: /.) 1/) 3aximi>ing val$e means a decision will have the best possible o$tcome for the parties involved. Answer: T !" "xplanation: 3aximi>ing val$e is a matter of making a decision that res$lts in the ideal, or best possible sol$tion. A baseball manager, for example, wants to make a decision that will not only score r$ns, a favorable o$tcome, b$t win the game, the ideal or maximal o$tcome. (iff: ) *age ef: 9+ AA6&7: Analytic &kills -b.ective: /.) 12) -ne ass$mption of bo$nded rationality is that managers can analy>e all relevant information abo$t all alternatives for a sit$ation. Answer: #A0&" "xplanation: The idea of bo$nded rationality says that decision makers can never analy>e all information for the alternatives involved. &o decision makers need to p$t limits on how m$ch information they will analy>e. (iff: ) *age ef: 9+ AA6&7: Analytic &kills -b.ective: /.)

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1+) A synonym for the word satisfice is maximize. Answer: #A0&" "xplanation: The words satisfice and maximize are opposites rather than synonyms. <hen a manager does not have eno$gh information to maximize, or find the best possible sol$tion to a problem, he or she m$st compromise, or satisfice. <hen yo$ satisfice yo$ accept not the best sol$tion, b$t a sol$tion that is =good eno$gh.= (iff: ) *age ef: 9+ AA6&7: Analytic &kills -b.ective: /.) 19) -ne ass$mption of bo$nded rationality is that managers $s$ally make rational decisions. Answer: T !" "xplanation: 7o$nded rationality ass$mes that managers are logical, ob.ective, and fairly rational when they make decisions. ?owever, since managers often don:t have access to all of the relevant information for a given sit$ation, they m$st bo$nd their rationality within the limits of the information they act$ally have. (iff: ) *age ef: 99 AA6&7: Analytic &kills -b.ective: /.) 1;) Int$itive decision making is systematic, logical, and orderly. Answer: #A0&" "xplanation: Int$itive decisions may be perfectly so$nd, b$t they are not arrived at thro$gh a systematic analysis of alternatives. Instead, int$itive decisions are 5$ickly made and rely on experience, $nconscio$s reasoning, feelings, and h$nches. (iff: ) *age ef: 99 AA6&7: Analytic &kills -b.ective: /.) 1,) Int$itive decision making cannot be a part of the rational decision'making process. Answer: #A0&" "xplanation: Int$itive decisions are not arrived at in a deliberative, systematic manner, b$t they can be ob.ective and logical, so they are considered rational. (iff: ) *age ef: 99 AA6&7: Analytic &kills -b.ective: /.) 11) The expression =throwing good money after bad= is an example of an escalation of commitment. Answer: T !" "xplanation: Throwing good money after bad typically denotes a sit$ation in which money has already been wasted on an $ns$ccessf$l vent$re%=bad money.= Throwing more =good money= into the sit$ation simply beca$se of the =bad money= already committed is a clear example of escalation of commitment. (iff: ) *age ef: 99 AA6&7: Analytic &kills -b.ective: /.)

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)4) "motions sho$ld always be strictly ignored in a decision'making process. Answer: #A0&" "xplanation: (ecisions that were accompanied by strong feelings were fo$nd to be more reliable than those that did not have an emotional component, according to one st$dy, especially in cases in which decision makers acknowledged their feelings. &o emotions sho$ld not be ignored d$ring the decision'making process. (iff: ) *age ef: 9; AA6&7: Analytic &kills -b.ective: /.) )1) *rogrammed decisions tend to be ro$tine. Answer: T !" "xplanation: A programmed decision is a ro$tine decision that works well in solving str$ct$red problems that present no ambig$ity or $nknown elements. *rogrammed decisions can $s$ally be solved $sing a systematic proced$re, r$le, or policy. (iff: 1 *age ef: 9, AA6&7: Analytic &kills -b.ective: /./ ))) A r$le is simpler than a policy or a proced$re to implement. Answer: T !" "xplanation: A r$le is a simple statement that can be applied directly to a sit$ation. #or example, a broker can easily follow a r$le to sell a specific stock when it reaches a specific price point. A proced$re or policy may have an identical o$tcome, b$t a more complicated series of steps m$st be taken to arrive at that o$tcome. (iff: ) *age ef: 9,'91 AA6&7: Analytic &kills -b.ective: /./ )/) Implementing a proced$re re5$ires more .$dgment and interpretation than implementing a policy. Answer: #A0&" "xplanation: A proced$re is a series of steps that m$st be followed to arrive at a decision, each of the steps being clear and straightforward. A policy provides g$idelines rather than steps for the decision maker to follow. "ach g$ideline m$st be interpreted and eval$ated for the sit$ation at hand. Therefore a policy re5$ires m$ch more .$dgment and interpretation than a proced$re. (iff: ) *age ef: 91 AA6&7: Analytic &kills -b.ective: /./ )2) A highway speed limit is an example of a policy. Answer: #A0&" "xplanation: A highway speed limit is an example of a r$le, not a policy. *olicies re5$ire the decision maker to exercise .$dgment and interpretation. #ollowing a speed limit, on the other hand, involves no interpretation. The driver simply m$st not exceed the posted speed. (iff: ) *age ef: 91 -b.ective: /./

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)+) 3anagerial decisions are likely to become more programmed as managers rise in an organi>ational hierarchy. Answer: #A0&" "xplanation: *roblems that managers face become more $ni5$e, ambig$o$s, and diffic$lt as the stat$s of a manager rises, not more programmed. Top managers are paid more than lower'level managers specifically beca$se they are expected to make diffic$lt decisions. 3ore ro$tine decisions are made by lower'level managers. (iff: ) *age ef: ;4 -b.ective: /./ )9) 3ost managerial decisions incl$de an element of risk. Answer: T !" "xplanation: #ew sit$ations involve certainty, in which a manager knows all o$tcomes in a sit$ation and can choose between them. Instead, sit$ations $s$ally involve risk, in which the manager m$st estimate the probability of different o$tcomes. (iff: 1 *age ef: ;4 -b.ective: /./ );) !ncertainty involves a sit$ation in which the probability of a certain o$tcome is known to be small. Answer: #A0&" "xplanation: In an $ncertain sit$ation, the probabilities of specific o$tcomes are not known and cannot be reasonably estimated. Therefore, the probability that any o$tcome is high or low cannot be determined. (iff: / *age ef: ;4 AA6&7: Analytic &kills -b.ective: /./ ),) A manager is more confident of his assessment of a sit$ation if it involves risk rather than $ncertainty. Answer: T !" "xplanation: <ith risk, a manager is able to estimate the likelihood of specific o$tcomes. <ith $ncertainty, not eno$gh is known even to make estimates. &o a manager wo$ld be more confident of a position involving risk. (iff: / *age ef: ;4 AA6&7: Analytic &kills -b.ective: /./ )1) @ro$p decisions tend to provide more complete information than individ$al decisions. Answer: T !" "xplanation: 7eca$se =two heads are better than one= gro$ps tend to identify more alternatives and consider more information before coming to a decision. (iff: 1 *age ef: ;1 -b.ective: /.2

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/4) An advantage of gro$p decisions is that they increase the perception of the legitimacy of the sol$tion. Answer: T !" "xplanation: <hen decisions that affect many people are made witho$t their consent, they tend to be less well accepted than gro$p decisions in which all parties are cons$lted. A gro$p decision is perceived to be more legitimate beca$se it was made in a more democratic manner. (iff: 1 *age ef: ;1 AA6&7: 6omm$nication -b.ective: /.2 /1) A drawback of gro$p decision making is gro$pthink. Answer: #A0&" "xplanation: <hen a gro$p experiences gro$pthink, members do not freely express their opinions for fear of standing o$t and having to ass$me responsibility for their actions. @ro$pthink often res$lts in bland, $nimaginative decisions that fail beca$se they are too timid. (iff: 1 *age ef: ;) AA6&7: 6omm$nication -b.ective: /.2 /)) @ro$ps tend to be more efficient and less effective than individ$al decision making. Answer: T !" "xplanation: The reverse is $s$ally tr$e. 7eca$se achieving consens$s within a gro$p takes time, gro$p decision making often takes longer than individ$al decision making it less efficient. ?owever, gro$ps are typically more thoro$gh than individ$als, so gro$p decisions are often more effective at achieving goals than decisions made by individ$als. (iff: ) *age ef: ;/ -b.ective: /.2 //) Two ma.or advantages of electronic meetings are anonymity and honesty. Answer: T !" "xplanation: "lectronic meetings allow participants to type in comments witho$t needing to identify themselves. This creates an atmosphere in which people feel more free to express their tr$e feelings. (iff: ) *age ef: ;2 AA6&7: Technology -b.ective: /.2 /2) A co$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 !" "xplanation: ?igh $ncertainty avoidance makes managers avoid diffic$lt decisions and be overly agreeable and accommodating. ?igh power distance allows high'stat$s individ$als to dominate gro$ps. 7oth of these attrib$tes wo$ld contrib$te to gro$pthink, the tendency of gro$ps to avoid controversy and conform to conventional positions. (iff: ) *age ef: ;+ AA6&7: Analytic &kills -b.ective: /.+

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/+) 6reative sol$tions to problems are val$ed beca$se they are new and different from traditional sol$tions. Answer: #A0&" "xplanation: 6reative sol$tions are val$ed only if they solve problems in ways that are s$perior to conventional sol$tions. -ften, solving a problem in a creative way can give a company a competitive edge on its competitors. (iff: 1 *age ef: ;1 -b.ective: /.+ /9) (ecision making begins with AAAAAAAA. A) selecting alternatives 7) identifying decision criteria 6) identifying a problem () eliminating false alternatives Answer: 6 "xplanation: 6) The process of decision making begins with the identification of a problem. -nce the problem has been identified the decision maker goes thro$gh a series of steps to solve the problem. &electing alternatives is part of the decision'making process b$t it is a step that comes m$ch later, after criteria have been identified, weighed against one another, developed into alternatives, and analy>ed as alternatives. "liminating false alternatives, is something that a decision maker might do, b$t it is not a recogni>ed part of the process. (iff: ) *age ef: +, -b.ective: /.1 /;) <hich of the following defines a problem in the decision'making processB A) a discrepancy between what exists and what the decision maker desires to exist 7) a discrepancy between the ideal and the practical 6) something that ca$ses irritation () something that calls for attention Answer: A "xplanation: A) Tho$gh problems certainly can irritate, and merit attention, these characteristics are not $niversal eno$gh by themselves to define what a problem is in the decision'making process. In this process, a problem is defined as a discrepancy, or difference between how things are and how the decision maker wants things to be. A problem is not a difference between the ideal and the practical, b$t rather .$st a sit$ation in which things are less than satisfactory, and the decision maker intends to take action to make them satisfactory. (iff: 1 *age ef: +, -b.ective: /.1

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/,) The decision'making process consists of a series of eight steps that identify a problem and work toward $ltimately AAAAAAAA. A) determining if there is a sol$tion to the problem 7) solving the problem 6) making a plan to solve the problem () breaking down the problem into a series of steps Answer: 7 "xplanation: 7) The goal of the decision'making process is to solve the problem that has been identified. The process ass$mes that there is a sol$tion to the problem, so determining if there is a sol$tion to the problem is not correct. The process incl$des making a plan to solve the problem and breaking the problem down into steps. ?owever, $ltimately the decision maker wants to implement the best alternative to solve the problem, then eval$ate this alternative to see if it act$ally res$lted in a s$ccessf$l sol$tion. (iff: 1 *age ef: +, AA6&7: Analytic &kills -b.ective: /.1 /1) To identify a problem, a manager AAAAAAAA. A) compares one set of standards or goals to a second set of standards or goals 7) looks for $nhappy c$stomers 6) $ses int$ition to see that things don:t look right () compares the c$rrent state of affairs with some standard or goal Answer: ( "xplanation: () A manager compares what she has now to some standard or goal to identify a problem. The standard or goal may represent some level of performance from the past, or it co$ld be an as yet $nreached level that the manager thinks can be attained. 0ooking for $nhappy c$stomers or $sing int$ition to see when things don:t look right may be ways to identify problems b$t they are not general problem identification methods. #inally, comparing one set of standards or goals to a second set is incorrect beca$se a problem is always identified by comparing an act$al state to a standard or goal, not one set of standards or goals to another. (iff: 1 *age ef: +, -b.ective: /.1 24) A manager can faithf$lly exec$te the decision'making process, b$t still end $p with nothing of val$e if AAAAAAAA. A) he fails to identify the correct problem 7) he fails to assign n$mber val$es to different criteria 6) he solves the problem inefficiently () he fails to correctly identify the steps of the process Answer: A "xplanation: A) Assigning n$mber val$es to decision criteria may often be helpf$l in the decision'making process, b$t they are not re5$ired for a s$ccessf$l o$tcome. &olving the problem inefficiently may not be ideal, b$t it is not witho$t val$e. Identifying the steps of the process have little to do with the s$ccess of the process. That leaves failing to identify the correct problem%it does no good to solve a problem if it is the wrong problem. &olving the wrong problem has no benefit for the organi>ation or its goals. (iff: ) *age ef: +1 AA6&7: Analytic &kills -b.ective: /.1
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21) A manager is considering p$rchasing new comp$ters for her department. The manager spends time assessing the comp$ters her department now has. <hich stage of the decision' making process is she going thro$ghB A) identification of a problem 7) identification of decision criteria 6) development of alternatives () implementation of an alternative Answer: A "xplanation: A) The first thing the manager needs to do is identify the problem. 3ore specifically, she needs to determine whether she act$ally has a problem or not. If the comp$ters her department now has are performing satisfactorily, she may decide that she doesn:t have a problem and doesn:t need to p$rchase new comp$ters. The other choicesidentifying criteria, developing alternatives, or implementing an alternativeall come later in the process, after the manager has determined what her problem is. (iff: ) *age ef: +,'+1 AA6&7: Analytic &kills -b.ective: /.1 2)) 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 thisB A) selection of an alternative 7) identification of decision criteria 6) development of alternatives () analysis of alternatives Answer: 6 "xplanation: 6) ?aving a list of models means that the manager is beyond identifying decision criteria. &he has identified a gro$p of possible choices%in other words, she has developed a list of alternatives. Analysis of the alternatives will be the next step in the process, followed by act$ally selecting one partic$lar alternative. The manager wo$ld have identified decision criteria earlier in the process. (iff: ) *age ef: +,'+1 AA6&7: Analytic &kills -b.ective: /.1

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2/) 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$tB A) analysis of alternatives 7) eval$ation of decision effectiveness 6) selection of an alternative () implementation of an alternative Answer: 7 "xplanation: 7) The manager is assessing her decision to p$rchase new comp$ters. <as it worth itB This is the final stage of the decision'making process, eval$ation of decision effectiveness. Analy>ing alternatives, selecting a single alternative, and implementing that single alternative all come earlier in the decision'making process. (iff: ) *age ef: +,'9) AA6&7: Analytic &kills -b.ective: /.1 22) #or a high'tech bicycle b$yer, decision criteria wo$ld be determined by AAAAAAAA. A) whatever most bike b$yers recommend 7) expert ratings in bike maga>ines 6) technical specifications () personal preferences of the b$yer Answer: ( "xplanation: () 6riteria are chosen solely on the basis of the priorities of the b$yer. If bike experts consider frame composition a key criterion for choosing a bike b$t the b$yer does not consider it important, then it wo$ld be $nlikely to be incl$ded as a criterion. &imilarly, pop$larity of bike feat$res or technical specifications might enter into the decision'making process, b$t only if the b$yer tho$ght they were important. In other words, the only factors that are important for selection of decision criteria for a bike b$yer are the personal preferences of the b$yer. (iff: ) *age ef: +1 AA6&7: Analytic &kills -b.ective: /.1 2+) <hich of the following is 0"A&T likely to be a decision criterion for a high'tech bicycle b$yer who cares primarily abo$t performanceB A) warranty 7) gear mechanism 6) frame composition () brake assembly Answer: A "xplanation: A) A b$yer who is looking for performance wo$ld care how st$rdy and light the frame was, and how efficient the gears and brakes were. The warranty does not directly affect performance so it wo$ld be least likely to be a decision criterion for the bike b$yer. (iff: ) *age ef: +1 AA6&7: Analytic &kills -b.ective: /.1

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29) <hich of the following wo$ld be a fairly ob.ective criterion by which a bicycle b$yer co$ld assess different bike modelsB A) handling 7) weight 6) 5$ality of craftsmanship () style Answer: 7 "xplanation: 7) -f the fo$r choices, only weight can be meas$red in an ob.ective manner. ?andling, craftsmanship, and style all re5$ire making s$b.ective .$dgments abo$t what the b$yer likes and doesn:t like. &tyle is largely a matter of taste. ?andling and craftsmanship cannot be meas$red on a simple scale. &o weight is the correct choice here. (iff: ) *age ef: 94 AA6&7: Analytic &kills -b.ective: /.1 2;) A manager chooses to ignore a rigoro$s decision'making process and select TC monitor A over monitor 7 beca$se he =tr$sts= company A more than company 7. If the decision he made was rational, which of the following is tr$eB A) 3onitor A is really the better choice. 7) The manager sho$ld have incl$ded =tr$st= as a criterion. 6) 3onitor 7 is really the better choice. () The manager m$st have made a mistake in calc$lating his weighted criteria. Answer: 7 "xplanation: 7) There is no way of knowing whether monitor A was really a better choice than 7 or if the manager made a calc$lation error. <hat is tr$e is that the manager sho$ld have incl$ded =tr$st= as one of his criteria categories. If tr$st was an overriding factor, then the manager sho$ld have weighted it heavily so it tilted the score toward what his tr$e feelings were. In essence, the manager made a mistake in selecting and weighting criteria. (iff: / *age ef: 94'91 AA6&7: Analytic &kills -b.ective: /.1 2,) In allocating weights to the decision criteria, which of the following is most helpf$l to rememberB A) All weights m$st be the same. 7) The total of the weights m$st s$m to 144. 6) The high score sho$ld be a 14, and no two criteria sho$ld be assigned the same weight. () Assign the most important criterion a score, and then assign weights against that standard. Answer: ( "xplanation: () There are no set r$les for weighting criteria. All weights can be the same, b$t in most cases they will be different. &imilarly, there is no total amo$nt that all weights sho$ld s$m to. The high score may or may not be assigned a 14, and in many cases two or more criteria can be assigned with the same weight. -nly assigning the most important criterion a score and assigning weights against that standard offers helpf$l advice%meas$ring each criterion against a standard in most cases will res$lt in a reliable representation of val$es. (iff: / *age ef: 94 AA6&7: Analytic &kills -b.ective: /.1
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21) <hat is a he$risticB A) a complicated and systematic method of decision making 7) a p$rely int$itive method of decision making 6) a totally $nreliable method of decision making () a shortc$t or r$le of th$mb that is $sed for decision making Answer: ( "xplanation: () A he$ristic is a r$le of th$mb that allows a decision maker to foc$s on a few key variables in the process. ?e$ristics can be $sef$l, so they are not totally $nreliable. ?e$ristics is simple, making a complicated and systematic method of decision making incorrect. ?e$ristics can be partly int$itive, b$t they can also be highly rational, making a p$rely int$itive method incorrect. (iff: ) *age ef: 9) -b.ective: /.1 +4) 7eca$se they are not systematic or comprehensive, $sing he$ristics in place of an eight'step decision'making process can lead to AAAAAAAA. A) errors and biases 7) consistently better decisions 6) more imaginative decisions () decisions that more directly solve problems Answer: A "xplanation: A) Tho$gh he$ristics can be very $sef$l in saving time and effort, they can also lead to mistakes, making =errors and biases= the correct response here. There is no evidence that $sing he$ristics res$lts in more imaginative decisions or decisions that solve problems more directly. #inally, since he$ristics are known to lead to errors and biases, they clearly do not lead to better decisions, so =consistently better decisions= is incorrect. (iff: ) *age ef: 9) AA6&7: Analytic &kills -b.ective: /.1 +1) <hich of the following is D-T a reason why managers often resort to $sing he$risticsB A) They seem to eliminate complexity. 7) They seem to eliminate ambig$ity. 6) They save time. () They thoro$ghly explore all alternatives. Answer: ( "xplanation: () The one thing that a he$ristic does not do is explore all alternatives for solving a problem. Instead, a he$ristic looks at only a small part of the problem and $ses key feat$res to arrive at a decision and avoid a complete examination of the options. ?e$ristics often do s$ccessf$lly seem to make complicated, ambig$o$s sit$ations easier to $nderstand and deal with, so eliminating complexity and ambig$ity are eliminated as correct answers. <itho$t a do$bt, he$ristics save time which eliminates =saving time= as the correct answer. (iff: ) *age ef: 9) AA6&7: Analytic &kills -b.ective: /.1

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+)) 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 ofB A) overconfidence 7) immediate gratification 6) selective perception bias () representation Answer: 7 "xplanation: 7) The correct answer here m$st be an error or bias that deals with short' and long' term gain. -verconfidence is the tendency of a decision maker to assess his own skills in a more positive light than they deserve, so it has nothing to do with short'term gain. <hen a person organi>es events based on fa$lty perceptions, he is g$ilty of selective perception bias, again not directly concerned with short'term gain. epresentation bias involves drawing parallels to events that aren:t really related, so it is not correct here. -nly immediate gratification, which is the tendency to go for a =5$ick score,= involves going for short'term rather than long'term gain, so it is the correct response here. (iff: ) *age ef: 9)'9/ AA6&7: Analytic &kills -b.ective: /.1 +/) A scientist cites two st$dies that show a positive effect for her dr$g and ignores five other st$dies that show a negative effect. <hich error or bias is she committingB A) hindsight 7) anchoring effect 6) confirmation bias () self'serving Answer: 6 "xplanation: 6) The scientist is =cherry picking= data that s$pports her position and ignoring conflicting data. &he is g$ilty of confirmation bias, seeing only what confirms her preconceived notions. ?indsight wo$ld re5$ire her to look back on events and claim that they were predictable, something that is not relevant here. Deither is self'serving, blaming o$tcomes on o$tside factors rather than taking responsibility for yo$r own errors. #inally, the anchoring effect describes an individ$al who fails to ad.$st to incoming information, again not something that the scientist is doing in this sit$ation. (iff: ) *age ef: 9) AA6&7: Analytic &kills -b.ective: /.1

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+2) -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 aEn) AAAAAAAA. A) representation bias 7) self'serving bias 6) availability bias () framing bias Answer: ( "xplanation: () A representation bias is a false parallel of c$rrent events to other events, something that is not occ$rring here. A self'serving bias, blaming the sit$ation on o$tside infl$ences, is also not relevant to this sit$ation. Availability bias occ$rs when decision makers val$e only the most recent events that are relevant to the sit$ation, also not occ$rring here. <hat is occ$rring is that the legislators are framing the problem in different ways. This framing res$lts in them coming to very different concl$sions abo$t how to solve the problem. (iff: ) *age ef: 9/ AA6&7: Analytic &kills -b.ective: /.1 ++) <hich of the following is D-T a common decision'making error or biasB A) s$nk costs 7) randomness 6) forest for the trees () overconfidence bias Answer: 6 "xplanation: 6) All of the choices are listed as common decision'making errors and biases except =forest for the trees.= &$nk costs refers to managers who fixate on past costs rather than f$t$re conse5$ences. andomness occ$rs when managers see patterns and trends that do not exist. -verconfidence bias occ$rs when managers overestimate their own strengths and skills. (iff: ) *age ef: 9)'9/ -b.ective: /.1 +9) The three main models that managers $se to make decisions are AAAAAAAA. A) rational, bo$nded rational, and int$itive 7) rational, irrational, bo$nded rational 6) int$itive, $nint$itive, rational () bo$nded rational, int$itive, systematic Answer: A "xplanation: A) 3odels that managers $se to make decisions incl$de the rational model, the bo$nded rational model, and the int$itive model. The rational model foc$ses on being logical and ob.ective. The bo$nded rational model ass$mes limitations on the rational model and makes =good eno$gh= decisions. The int$itive model employs emotions and s$bconscio$s modes of thinking within a rational context. The other three choices are all incorrect beca$se they incl$de categories that do not identify decision'making methods: irrational, $nint$itive, and systematic. (iff: 1 *age ef: 92'99 -b.ective: /.)

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+;) It is ass$med that a rational decision maker AAAAAAAA. A) wo$ld never make a wrong choice 7) wo$ld be s$b.ective and impractical 6) wo$ld face only diffic$lt decisions () wo$ld be ob.ective and logical Answer: ( "xplanation: () A perfectly rational decision maker wo$ld always make a =good= decision based on so$nd reasoning, b$t he or she co$ld still make the wrong choice in a given sit$ation. A rational decision maker wo$ld face both easy and diffic$lt problems. &$b.ectivity and impracticality are not characteristics of a rational decision maker. The important characteristics of a rational decision maker are that he or she is rational and logical, meaning that being ob.ective and logical is the correct response. (iff: ) *age ef: 92 AA6&7: Analytic &kills -b.ective: /.) +,) <hat does it mean for a decision maker to maximi>e val$eB A) to make the decision to be as clear and logical as possible 7) to make the achievement of goals as likely as possible 6) to waste as little time and energy as possible () to make decision making as simple as possible Answer: 7 "xplanation: 7) 3aximi>ing val$e is a 5$estion of achieving goals. <hen a decision maker maximi>es val$e, he or she makes the decision that is most likely to achieve his or her goal. 7eing clear and logical, efficient, or simple are worthy goals for a decision maker, b$t they do not define maximi>ing val$e so they are incorrect responses for this 5$estion. (iff: ) *age ef: 92 AA6&7: Analytic &kills -b.ective: /.) +1) 3aximi>ing val$e for an organi>ation means making s$re that AAAAAAAA. A) the organi>ation makes money 7) the best interests of the organi>ation are addressed 6) the decision made is as rational as possible () the decision is as simple as possible Answer: 7 "xplanation: 7) 3anagerial decisions for an organi>ation m$st always take the organi>ation:s best interests into acco$nt. This is how decisions for organi>ations differ from those for individ$als. As an individ$al a manager looks o$t only for him' or herself. As a manager the same person m$st p$t the interests of the organi>ation first. 3aking money, or making highly rational or simple decisions does not maximi>e val$e for an organi>ation. (iff: ) *age ef: 92 AA6&7: Analytic &kills -b.ective: /.)

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94) <hich of the following is D-T ass$med in a rational decisionB A) a clear and specific goal 7) a clear and $nambig$o$s problem 6) many alternatives and conse5$ences are known () val$e is maximi>ed Answer: 6 "xplanation: 6) The ideal rational decision will feat$re a clear and specific goal, a problem that is clear and $nambig$o$s, and val$e is maximi>ed. This ideal decision wo$ld also re5$ire that all, not .$st many alternatives and conse5$ences, wo$ld be known. (iff: ) *age ef: 92 AA6&7: Analytic &kills -b.ective: /.) 91) It is ass$med that in most cases, the decisions of all managers are limited by AAAAAAAA. A) greed and short'sightedness 7) having too m$ch information 6) not being able to analy>e all information for all alternatives () not being able to act rationally or in the best interests of their organi>ation Answer: 6 "xplanation: 6) @reed and short'sightedness may affect the decisions of some, b$t clearly not all managers. 3ost managers are rational in that they are reasonable, logical, and have the best interests of their organi>ation in mind. <hat limits the decisions of managers most of the time is not having too m$ch information b$t having too little, and not having the time or reso$rces to be able to analy>e all of the information that is relevant to all of the alternatives in a given sit$ation. (iff: ) *age ef: 9+ AA6&7: Analytic &kills -b.ective: /.) 9)) <hich term best characteri>es a decision that has bo$nded rationalityB A) virt$ally perfect 7) rigoro$s and comprehensive 6) not good eno$gh () good eno$gh Answer: ( "xplanation: () ather than tho$ght to be perfect or rigoro$s and thoro$gh, a bo$nded rationality decision is considered to be .$st =good eno$gh.= (iff: ) *age ef: 9+ AA6&7: Analytic &kills -b.ective: /.)

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9/) &oftware programs that $se a series of 5$estions to aid h$mans in decision making are called AAAAAAAA. A) text reading software 7) expert systems 6) gro$p systems () s$pport software Answer: 7 "xplanation: 7) &ystems that $se se5$ential 5$estion'asking systems to aid decision makers s$ch as doctors to diagnose illnesses are called expert systems. Text reading software is $sed simply to decipher text. &$pport software is generic software for any application. @ro$p systems are not $sed for decision making. (iff: ) *age ef: 9+ AA6&7: Technology -b.ective: /.) 92) "xpert systems are primarily $sed to help what kinds of decision makersB A) lower'level managers 7) top managers 6) senior managers () experts Answer: A "xplanation: A) "xpert systems are primarily $sed by non'experts to make high 5$ality decisions. These non'experts are typically lower'level managers. Top managers, senior managers, or experts may all $se expert systems from time to time, b$t the systems are designed specifically to g$ide non'experts in making $sef$l decisions. (iff: ) *age ef: 9+ AA6&7: Technology -b.ective: /.) 9+) De$ral networks are able to o$tdo the performance of h$mans by AAAAAAAA. A) analy>ing symbols 7) handling $p to three variables at once 6) handling h$ndreds of variables at once () reading facial expressions Answer: 6 "xplanation: 6) ?$mans typically can only process two or three variables at once when problem solving. De$ral networks can handle h$ndreds of variables, o$tdoing h$man performance. Analy>ing symbols is incorrect beca$se both comp$ters and h$mans can analy>e symbols. As yet, no comp$ters are proficient at extracting important information by reading facial expressions. (iff: ) *age ef: 9+ AA6&7: Technology -b.ective: /.)

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99) De$ral networks differ from expert systems in that they can AAAAAAAA. A) draw concl$sions from data 7) ask 5$estions to the decision maker 6) perform sophisticated calc$lations () learn from experience Answer: ( "xplanation: () De$ral networks are special beca$se they can learn from experience. &it$ations are shown to the network and the network learns to recogni>e keys to these sit$ations so that it can recogni>e them and employ what was learned to make decisions in the f$t$re. (rawing concl$sions, asking 5$estions, or performing complicated calc$lations are all normal f$nctions for a software program and not special to ne$ral networks. (iff: ) *age ef: 9+ AA6&7: Technology -b.ective: /.) 9;) De$ral networks o$tperfom expert systems in $ncovering AAAAAAAA. A) credit card fra$d 7) false positives for pregnancy 6) potential credit card c$stomers () credit problems in bank mortgages Answer: A "xplanation: A) "xpert systems were flawed in dealing with credit card fra$d in that they kept giving false positives%finding fra$d where it didn:t exist. De$ral networks proved to be m$ch better at discovering credit card fra$d witho$t many false positives. De$ral networks were not $sed for pregnancy tests, finding new credit card c$stomers, or finding credit problems in mortgages. (iff: ) *age ef: 9+ AA6&7: Technology -b.ective: /.) 9,) ?erbert &imon won the Dobel *ri>e in economics for his work in describing AAAAAAAA. A) how people spend money 7) how most people are perfectly rational 6) how people make decisions () how people avoid decisions Answer: 6 "xplanation: 6) ather than st$dy how people spend money, &imon st$died how people made decisions. ?e fo$nd that people were limited in their ability to $se logic and were not perfectly rational in their decision making. &imon did not investigate how people avoid decisions. (iff: ) *age ef: 9+ -b.ective: /.)

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91) <hich of the following is the best definition for the word satisficeB A) very satisfying 7) not s$fficient 6) accepts a less than perfect sol$tion () re5$ires a perfect sol$tion Answer: 6 "xplanation: 6) <hen yo$ satisfice yo$ are accepting a =good eno$gh= or less than perfect sol$tion to a problem. Dot s$fficient is incorrect beca$se satisficing is often s$fficient to solve a problem. Cery satisfying is wrong beca$se tho$gh satisfice so$nds like satisfy, it has nothing to with that word. #inally, re5$ires a perfect sol$tion is incorrect beca$se the term does not re5$ire the perfect sol$tion, b$t rather a compromise on perfection. (iff: ) *age ef: 99 -b.ective: /.) ;4) &imon fo$nd that in making decisions, most people satisficed beca$se they had limited ability to AAAAAAAA. A) be tr$thf$l and honest in sit$ations that deal with other people 7) think independently 6) deal with diffic$lt sit$ations () grasp present conditions and anticipate f$t$re conditions Answer: ( "xplanation: () &imon fo$nd that people were limited in f$lly $nderstanding their c$rrent sit$ation. <itho$t $nderstanding the present, they also had tro$ble planning for the f$t$re. Tho$gh people may have tro$ble being honest, dealing with diffic$lt sit$ations, and thinking independently, none of these items were involved in &imon:s work. (iff: ) *age ef: 99 -b.ective: /.) ;1) A person who satisfices fails to AAAAAAAA. A) maximi>e his or her decision 7) $nderstand his or her position 6) accept the tr$th of a sit$ation () make any kind of decision Answer: A "xplanation: A) &atisficing is accepting a =good eno$gh= position, rather than maximi>ing a decision. <hen a decision is maximi>ed, goals are reached and the best possible sol$tion is fo$nd. &atisficing does not entail failing to: $nderstand one:s position, accept the tr$th, or make a decision to begin with. Instead, satisficing involves going with a less than thoro$gh examination of all o$tcomes to find a =good eno$gh= sol$tion. (iff: ) *age ef: 99 -b.ective: /.)

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;)) &ticking to a decision despite evidence that it is a mistake is called AAAAAAAA. A) escalation of commitment 7) escalation of rationality 6) satisficing commitment () error enhancement Answer: A "xplanation: A) In some cases, people feel committed to a decision even when evidence shows that it was fa$lty. This tendency of failing to let go of a decision is called escalation of commitment. "scalation of rationality is incorrect beca$se it does not refer to commitment. &ticking with a poor decision is not satisficing so that choice is incorrect. "rror enhancement may describe this sit$ation somewhat, b$t it is not a recogni>ed term. (iff: ) *age ef: 99 -b.ective: /.) ;/) "scalation of commitment can occ$r when people don:t AAAAAAAA. A) want to make a decision 7) want to admit that an earlier decision was flawed 6) accept c$rrent conditions () $nderstand that conditions have changed Answer: 7 "xplanation: 7) "scalation of commitment can occ$r when people cling to an earlier decision. ather than admit it was wrong and that they sho$ld start over, they stick with their original decision. #ailing to make a decision in the first place, accepting c$rrent conditions, or $nderstanding that conditions have changed are not sit$ations in which escalation of commitment occ$rs. (iff: ) *age ef: 99 -b.ective: /.) ;2) <hich model of decision making takes advantage of $nconscio$s reasoningB A) rational 7) non'rational 6) int$itive () fact$al Answer: 6 "xplanation: 6) Int$itive decision making $ses feelings, memories, experiences, and $nconscio$s reasoning to arrive at decisions. !nlike strictly rational decision making, int$itive decision making is not a systematic approach. Int$itive decision making is rational to a degree, making non'rational an incorrect choice. #act$al is not a correct choice beca$se it is not recogni>ed as a decision making model. (iff: ) *age ef: 99 AA6&7: Analytic &kills -b.ective: /.)

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;+) 6ompared to f$lly rational decision making, what is a ma.or advantage of int$itive decision makingB A) total reliability 7) f$lly 5$antified 6) thoro$ghness () speed Answer: ( "xplanation: () Int$itive decision making is somewhat reliable, b$t definitely not totally reliable, eliminating that choice. Int$itive decision making is not at all thoro$gh. In fact, it is often employed as a short'c$t in decision making. &ince the process is never spelled o$t on paper in terms of n$mbers and val$es, int$itive decision making is almost never 5$antified. Int$itive reasoning is fast, often beca$se decision makers are $sing years of experience to make a single .$dgment. (iff: ) *age ef: 99 AA6&7: Analytic &kills -b.ective: /.) ;9) ?ow often do managers typically $se int$itive decision makingB A) 144 percent of the time 7) almost never 6) almost all of the time () more than half of the time Answer: ( "xplanation: () &t$dies show that int$itive decision making is $sed more fre5$ently than formal analysis, meaning that managers $se it more than half of the time. Do managers claim to $se the method all or almost all of the time. Almost never can be eliminated beca$se managers say they $se int$itive decision making fre5$ently. (iff: ) *age ef: 99 AA6&7: Analytic &kills -b.ective: /.) ;;) Int$itive decision making can complement AAAAAAAA. A) rational decision making only 7) bo$nded rationality only 6) both rationality and bo$nded rationality () neither rationality nor bo$nded rationality Answer: 6 "xplanation: 6) Int$itive decision making does not conflict with a rational mode of thinking. Instead, int$itive decision making $ses experience and feelings to provide shortc$ts to rational decision making. #or these reasons, it is clear that both formal rationality and bo$nded rationality can have int$itive elements. (iff: ) *age ef: 9; AA6&7: Analytic &kills -b.ective: /.)

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;,) <hich of the following is D-T a way in which int$ition g$ides people who are making decisionsB A) Int$ition provides ethics and val$es g$idelines. 7) Int$ition provides a formal analysis method. 6) Int$ition provides experiences to draw from. () Int$ition draws on knowledge, skills, and training. Answer: 7 "xplanation: 7) Int$ition can give people insight into 5$estions that involve ethics and val$es, past experience, or knowledge and training. <hat int$ition cannot provide is any kind of formal or mathematical analysis, so providing a formal analysis method is the correct choice here. (iff: ) *age ef: 9; AA6&7: Analytic &kills -b.ective: /.) ;1) "motions and feelings AAAAAAAA decision making. A) have no effect on 7) can improve 6) decrease performance in () are more important than facts and logic in Answer: 7 "xplanation: 7) &t$dies show that emotions and feelings do affect decision making in a positive way, improving performance. That said, emotions and feelings do not replace facts and logic in decision making. (iff: ) *age ef: 9; AA6&7: Analytic &kills -b.ective: /.) ,4) &tr$ct$red problems are AAAAAAAA. A) ambig$o$s 7) $ndefined and vag$e 6) clear and straightforward () incomplete Answer: 6 "xplanation: 6) A str$ct$red problem involves a clear, $nambig$o$s, well'defined sit$ation in which all information is provided. The essence of a str$ct$red problem is that it is straightforward and complete. (iff: ) *age ef: 9, AA6&7: Analytic &kills -b.ective: /./

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,1) !nstr$ct$red problems are AAAAAAAA. A) perfectly rational 7) clear and straightforward 6) sit$ations in which all options are known () sit$ations in which all options are not known Answer: ( "xplanation: () The essence of an $nstr$ct$red problem is that information is missing. All alternatives are not known. The problem solver m$st analy>e the sit$ation based on ass$mptions that may or may not be tr$e. This means that sit$ations in which all options are not known is the correct answer. The sit$ation is not perfectly rational or straightforward. Information in an $nstr$ct$red problem is incomplete, so all options are not known. (iff: ) *age ef: 9, AA6&7: Analytic &kills -b.ective: /./ ,)) <hich of the following is an example of a str$ct$red problemB A) designing a new 3*/ player 7) hiring a lawyer 6) deciding shipping options for a vac$$m cleaner () drafting a 5$arterback for a pro football team Answer: 6 "xplanation: 6) A str$ct$red problem sho$ld be straightforward and clear'c$t. -f the fo$r choices, only =determining shipping options= re5$ires a simple analysis of choices and priorities. The other optionsdesigning a new prod$ct, hiring a person to represent yo$ in the legal system, and choosing a football player to lead yo$r teamall are m$ch less defined and more open ambig$ity than the correct choiceF in other words they are $nstr$ct$red problems. (iff: ) *age ef: 9, AA6&7: Analytic &kills -b.ective: /./ ,/) <hich of the following is an example of an $nstr$ct$red problemB A) finding the list price of different copy machines 7) choosing the best wardrobe for an exec$tive 6) comparing gas mileage for different car models () meas$ring poll$tion levels in a power plant Answer: 7 "xplanation: 7) An $nstr$ct$red problem re5$ires .$dgment and discrimination among options in a sit$ation in which not all information is available. -nly =choosing the best wardrobe for an exec$tive= fits this description, as choosing a wardrobe is a s$b.ective act that can be accomplished in many different ways. The other choicesfinding prices, comparing mileage, or meas$ring poll$tionare straightforward and do not incl$de this ambig$o$s, s$b.ective element, so they are incorrect responses. (iff: ) *age ef: 9, AA6&7: Analytic &kills -b.ective: /./

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,2) &tr$ct$red problems typically have AAAAAAAA while $nstr$ct$red problems typically have AAAAAAAA. A) only one sol$tionF many sol$tions 7) many sol$tionsF one sol$tion 6) many sol$tionsF fewer sol$tions () two sol$tionsF three sol$tions Answer: A "xplanation: A) &tr$ct$red problems, being straightforward, typically have one sol$tion while $nstr$ct$red problems, being more ambig$o$s, can have many sol$tions. Two sol$tions and three sol$tions stands o$t here as pla$sible b$t it is clearly incorrect since there is no way to 5$antify the n$mber of sol$tions to problems in s$ch a definite way. (iff: ) *age ef: 9, AA6&7: Analytic &kills -b.ective: /./ ,+) *rogrammed decisions work well for solving AAAAAAAA. A) str$ct$red problems 7) $nstr$ct$red problems 6) both str$ct$red and $nstr$ct$red problems () poorly defined problems Answer: A "xplanation: A) *rogrammed decisions are straightforward, ro$tini>ed ways of making decisions so they are best at solving str$ct$red problems, which themselves are ro$tine and straightforward. The remaining choice gets eliminated beca$se poorly defined problems fall into the =$nstr$ct$red= category and wo$ld not be served with a programmed decision'making process. (iff: ) *age ef: 9, AA6&7: Analytic &kills -b.ective: /./ ,9) *rogrammed decisions draw heavily on which of the followingB A) mistakes made in the past 7) past sol$tions that were s$ccessf$l 6) past sol$tions that were $ns$ccessf$l () innovative new sol$tions Answer: 7 "xplanation: 7) Tho$gh programmed decisions draw on the past, they do not foc$s on mistakes b$t rather em$late prior sol$tions that worked and were s$ccessf$l. Innovative new sol$tions is incorrect beca$se programmed decisions are not at all innovative b$t instead rely on tried and tr$e methods of problem solving. (iff: ) *age ef: 9, AA6&7: Analytic &kills -b.ective: /./

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,;) <hich of the following is D-T a type of programmed decisionB A) systematic proced$re 7) policy 6) brainstorm () r$le Answer: 6 "xplanation: 6) 7rainstorming is a method of dr$mming $p new ideas for problem solving, not a way to make a programmed decision. The other three choicessystematic proced$re, policy, and r$leare all recogni>ed as the classic ways to make a programmed decision so they are incorrect responses here. (iff: ) *age ef: 9, AA6&7: Analytic &kills -b.ective: /./ ,,) #ollowing the directions to p$t together an elliptical exercise machine is an example of which way to solve a problemB A) proced$re 7) r$le 6) general practice () policy Answer: A "xplanation: A) If yo$ co$ld p$t together the machine with a single action yo$ wo$ld be following a r$le. ?owever, assembly is an entire process of following individ$al instr$ctions, so it is a proced$re, not a r$le. A policy wo$ld re5$ire m$ch more interpretation of the sit$ation than simply following instr$ctions. (iff: 1 *age ef: 9, AA6&7: Analytic &kills -b.ective: /./ ,1) A football coach makes the decision to p$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 $seB A) a policy 7) a h$nch 6) a proced$re () a r$le Answer: ( "xplanation: () The coach:s decision is based on a single criterion: is he beyond the +4'yard lineB (ecision making that relies on a single parameter is r$le'following. A policy or a proced$re are not correct beca$se they involve m$ltiple steps and parameters. A h$nch is not correct beca$se it is not a recogni>ed method of solving str$ct$red problems. (iff: ) *age ef: 9,'91 AA6&7: Analytic &kills -b.ective: /./

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14) <hich pair or pairs of terms is tr$eB EThis 5$estion can have more than one correct answer.) A) str$ct$red problem, programmed decision 7) str$ct$red problem, str$ct$red decision 6) $nstr$ct$red problem, programmed decision () $nstr$ct$red problem, nonprogrammed decision Answer: A, ( "xplanation: A, () &tr$ct$red problem, programmed decision and $nstr$ct$red problem, nonprogrammed decision are both correct. &tr$ct$red problems that are straightforward and $nambig$o$s are best solved by ro$tine programmed decisions. !nstr$ct$red problems, on the other hand, re5$ire a more creative nonro$tine, nonprogrammed decision'making process. !nstr$ct$red problem, programmed decision gives pairs that do not match%$nstr$ct$red problems are not s$ccessf$lly solved by programmed decision making. #inally, str$ct$red problem, str$ct$red decision is wrong beca$se =str$ct$red decisions= are not a recogni>ed category of decision. (iff: 1 *age ef: 9,'91 AA6&7: Analytic &kills -b.ective: /./ 11) A .$dge cons$lts g$idelines before handing down an award for damages in a legal case. <hat kind of decision making is she doingB A) following a policy 7) following a r$le 6) programmed () following a proced$re Answer: A "xplanation: A) The .$dge needs to interpret the sit$ation, so she is following a policy. A r$le is m$ch too simple and confined for this kind of decision. The decision is clearly $nprogrammed. #inally, the .$dge m$st take all kinds of s$b.ective and h$man elements into acco$nt for the case, so a proced$re is an incorrect choice. (iff: ) *age ef: 91 AA6&7: Analytic &kills -b.ective: /./ 1)) Top managers in an organi>ation tend to AAAAAAAA. A) make programmed decisions 7) solve str$ct$red problems 6) make nonprogrammed decisions () solve well'defined problems Answer: 6 "xplanation: 6) The higher a manager is in an organi>ation, the more likely it is that he or she will be asked to solve high'level problems. ?igh'level problems are almost always solved by nonprogrammed decision making, so making nonprogrammed decisions is the correct answer. The other choices all involve str$ct$red problems, so they are not correct responses here. (iff: ) *age ef: 91 AA6&7: Analytic &kills -b.ective: /./

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1/) <hich three conditions do decision makers faceB A) certainty, risk, $ncertainty 7) certainty, $ncertainty, confidence 6) risk, high risk, low risk () certainty, risk, high risk Answer: A "xplanation: A) The choice indicating certainty, risk, and $ncertainty represents the correct choice, citing the three recogni>ed conditions that decision makers face. 6ertainty, $ncertainty, confidence is eliminated beca$se confidence is not a recogni>ed decision'making condition. &imilarly, the other two choices are wrong beca$se =risk= is the only recogni>ed decision'making category=high risk= and =low risk= are not recogni>ed. (iff: ) *age ef: ;4 AA6&7: Analytic &kills -b.ective: /./ 12) In a condition of certainty, AAAAAAAA. A) most o$tcomes are known 7) the decision is already made 6) all o$tcomes of all alternatives are known () some alternatives are not known Answer: 6 "xplanation: 6) 6ertainty re5$ires that all alternatives are known, and all o$tcomes for those alternatives are also known. This makes the choice indicating =all o$tcomes of all alternatives are known= the correct choice and the other choices incorrect beca$se they all limit the n$mber of o$tcomes or alternatives that are known. (iff: ) *age ef: ;4 AA6&7: Analytic &kills -b.ective: /./ 1+) If a car b$yer knows the inventory dealer price of the same car at different dealerships, he or she is operating $nder what type of decision'making conditionB A) risk 7) $ncertainty 6) certainty () fact$al Answer: 6 "xplanation: 6) The sit$ation described is one of certainty beca$se all o$tcomes and alternatives are known. isk wo$ld re5$ire that the individ$al needs to make estimates, while $ncertainty wo$ld mean that the individ$al wo$ld have no confidence in his or her estimation ability for the sit$ation. #act$al is not a correct choice beca$se it is not a recogni>ed decision'making condition. (iff: ) *age ef: ;4 AA6&7: Analytic &kills -b.ective: /./

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19) 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 conditionB A) seasonal 7) risk 6) $ncertainty () certainty Answer: 7 "xplanation: 7) The ability to make acc$rate estimates is the critical element in this 5$estion. If the manager can make good estimates, he is operating $nder risk. If all o$tcomes are known, then certainty wo$ld apply, while if the sit$ation is too vag$e for good estimates, $ncertainty wo$ld apply. &easonal is not a recogni>ed decision'making condition so it is incorrect. (iff: ) *age ef: ;4 AA6&7: Analytic &kills -b.ective: /./ 1;) AAAAAAAA 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) 6ertainty 7) isk 6) !ncertainty () ?igh certainty Answer: 6 "xplanation: 6) &ince the decision maker does not know all o$tcomes, certainty can be eliminated here. isk can be eliminated beca$se the decision maker is not able to make good estimates. That means $ncertainty is the correct response. ?igh certainty is not a recogni>ed category, so it is incorrect. (iff: ) *age ef: ;4 -b.ective: /./ 1,) A low'level manager is most likely to solve problems $nder which conditionB A) certainty 7) low risk 6) $ncertainty () low certainty Answer: A "xplanation: A) A low'level manager solves str$ct$red problems primarily so he or she will deal with sit$ations of certainty. 0ow risk and low certainty are not recogni>ed terms so they are incorrect responses. !ncertainty wo$ld apply to decisions made by top managers rather than low'level managers. (iff: ) *age ef: ;4 -b.ective: /./

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11) A top manager is most likely to solve problems $nder which conditionB A) certainty 7) risk 6) $ncertainty () high certainty Answer: 6 "xplanation: 6) A top'level manager primarily solves $nstr$ct$red problems primarily so he or she will deal with sit$ations of $ncertainty. 6onditions of certainty and risk wo$ld be less common for a top manager so these responses are incorrect. ?igh $ncertainty is not a recogni>ed term so it is an incorrect response. (iff: ) *age ef: ;4 -b.ective: /./ 144) A manager has a choice of three investment f$nds. To assess them, he looks at their past investment records over the previo$s five years. The manager is operating $nder which conditionB A) certainty 7) probability 6) $ncertainty () risk Answer: ( "xplanation: () The manager can $se the investment records over previo$s years to assign probabilities to each f$nd. That means she is operating $nder a condition of risk. 6ertainty wo$ld re5$ire that she wo$ld know precisely how f$nds wo$ld perform, while $ncertainty wo$ld mean she wo$ld have no way to predict performance. =*robability= is not a recogni>ed decision' making condition. (iff: ) *age ef: ;4 -b.ective: /./ 141) A manager has a choice of three bank 6(s that pay different amo$nts of interest over different time periods. The manager is operating $nder which conditionB A) .eopardy 7) certainty 6) $ncertainty () risk Answer: 7 "xplanation: 7) The manager knows the exact amo$nts of interest that the 6(s will pay over each time period, so he is operating $nder a condition of certainty. isk wo$ld re5$ire the manager to need to estimate the interest that the f$nds wo$ld generate. !ncertainty wo$ld be a condition in which the manager co$ld not even make good estimates for each f$nd. =Geopardy= is not a recogni>ed decision'making condition. (iff: ) *age ef: ;4 -b.ective: /./

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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. Done of the companies has a track record. The manager is operating $nder which conditionB A) $ncertainty 7) certainty 6) low certainty () risk Answer: A "xplanation: A) Done of the start'$ps has a track record, so the manager cannot reasonably assign probable chances of s$ccess for any of them. This means that he is operating $nder a condition of $ncertainty. isk wo$ld re5$ire that the manager co$ld make reasonable estimates of s$ccess for each company. 6ertainty wo$ld mean that the manager wo$ld know how each company wo$ld fare. =0ow certainty= is not a recogni>ed decision'making condition. (iff: ) *age ef: ;4 -b.ective: /./ 14/) A key to what is commonly $sed to assess risk is for a decision maker to examine the AAAAAAAA an investment. A) the promises made by a company for 7) the ads posted by a company for 6) historical data for () the minor details of Answer: 6 "xplanation: 6) -f the fo$r choices listed, historical data is most important by far. *romises made or ads posted by a company are of little val$e in assessing risk. &imilarly, minor details are $s$ally minor, that is, $nimportant, so that choice is incorrect. (iff: / *age ef: ;4 -b.ective: /./ 142) 3anagers in organi>ations make gro$p decisions AAAAAAAA. A) fre5$ently 7) never 6) almost never () rarely Answer: A "xplanation: A) @ro$p decisions are very common in most organi>ations so =fre5$ently= is the correct response. @ro$p decisions allow the people who will be affected by the decision to take part in the decision. The other choices are all incorrect beca$se they do not reflect how common gro$p decision making is. (iff: 1 *age ef: ;4 AA6&7: 6omm$nication -b.ective: /./

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14+) The eight steps of decision making AAAAAAAA. A) can only be employed by individ$als 7) can only be employed in very small gro$ps 6) can be employed by individ$als and gro$ps () can only be employed by gro$ps Answer: 6 "xplanation: 6) The eight steps of decision making can be $sed by individ$als or gro$ps of any si>e. All of the other choices for this 5$estion limit the scope of eight'step decision making somehow, so they are incorrect. (iff: ) *age ef: ;1 AA6&7: 6omm$nication -b.ective: /.2 149) -ne advantage of gro$p decision making is that it $s$ally provides AAAAAAAA than individ$al decision making. A) faster decisions 7) more ethical decisions 6) less conf$sion () more information Answer: ( "xplanation: () @ro$p decisions are rarely faster, more ethical, or less conf$sing than individ$al decisions. In fact, gro$p decisions $s$ally take more time and can involve more conf$sion than individ$al decisions. -ne thing that gro$p decisions consistently provide is more information for decisions. ?aving more people take part in a decision allows for more points of view and more so$rces of information to be incl$ded%therefore more information is the correct response. (iff: ) *age ef: ;1 AA6&7: 6omm$nication -b.ective: /.2 14;) @ro$p decisions generally feat$re AAAAAAAA acceptance than decisions made by an individ$al. A) greater 7) less 6) neither greater or less () more enth$siastic Answer: A "xplanation: A) @ro$p decisions are generally better accepted than individ$al decisions, primarily beca$se more people feel a part of the decision'making process. This eliminates =less= and =neither greater nor less= as correct responses. There is no data to indicate one way or another how enth$siastically decisions are accepted, so =more enth$siastic= is incorrect. (iff: ) *age ef: ;1 AA6&7: 6omm$nication -b.ective: /.2

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14,) @ro$p decision making typically increases the legitimacy of a decision beca$se the decision was made AAAAAAAA. A) over a long period of time 7) democratically 6) by experts () primarily by the gro$p leader Answer: 7 "xplanation: 7) It is hard to arg$e that a decision that was decided in a democratic manner is not legitimate, making =democratically= the correct response. The period of time in which a decision was made does not increase its legitimacy. @ro$p decisions are not likely to be made by experts, so that is not a correct response. #inally, a gro$p decision from a gro$p in which all members were not e5$ally empowered wo$ld tend to have less, rather than more legitimacy. (iff: ) *age ef: ;1 AA6&7: 6omm$nication -b.ective: /.2 141) (ecisions made by individ$als typically s$ffer from s$spicions that the decision maker AAAAAAAA. A) is dishonest 7) is not rational 6) did not try to analy>e the sit$ation () did not cons$lt all interested parties Answer: ( "xplanation: () 3ost organi>ation members tr$st decision makers to a degree, so individ$al decisions do not $s$ally s$ffer from feelings that the decision maker is not honest or rational. &imilarly, it is ass$med that the decision maker applied some kind of analytical skill to the sit$ation. The primary worry for most organi>ation members is that the decision maker did not get diverse eno$gh viewpoints to make the decision. (iff: ) *age ef: ;1 AA6&7: 6omm$nication -b.ective: /.2 114) &eeking the views of a diverse gro$p of people can provide a decision maker with AAAAAAAA on iss$es. A) fresh perspectives 7) conventional wisdom 6) $niversal agreement () a foolproof way to get the perfect answer Answer: A "xplanation: A) &eeking diverse views provides no g$arantee of a perfect answer for a problem. A decision maker seeking an easy way o$t will also not find agreement among diverse opinions, so $niversal agreement is also wrong. *eople with very different perspectives are highly $nlikely to s$pply conventional wisdom in a sit$ation, so that choice can be eliminated as a correct response. That leaves the fresh perspectives s$pplied by a diversity of viewpoints that can be s$rprising and very instr$ctive to a decision maker, providing ideas that she wo$ld never have been able to come $p with on her own. (iff: ) *age ef: ;1 AA6&7: 6omm$nication -b.ective: /.2
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111) <hich of the following is a drawback to seeking diverse views in decision makingB A) less reliable decision 7) easier decision'making process 6) more time cons$ming () less time cons$ming Answer: 6 "xplanation: 6) A ma.or drawback to seeking diverse views is that it takes time to reconcile these views and hammer o$t a decision that takes all of their best points into acco$nt. &ince seeking diverse views is more time'cons$ming, it does not make for an easier decision'making process, eliminating that choice. 0ess reliable decision can be r$led o$t beca$se there is no evidence that seeking diverse views in any way compromises the 5$ality of the decision itself. (iff: ) *age ef: ;1 AA6&7: 6omm$nication -b.ective: /.2 11)) <hich phrase best s$mmari>es the drawbacks of gro$p decisionsB A) A camel is a racehorse p$t together by a manager. 7) A camel is a racehorse p$t together by a committee. 6) A camel is a no racehorse when it comes to speed. () A camel beats a racehorse in a long race. Answer: 7 "xplanation: 7) The choice indicating a camel is a racehorse p$t together by a committee expresses the idea that committees can combine many good ideas into a single not'so'good idea by failing to appropriate a single point of view that foc$ses on a single goal. A racehorse p$t together by a manager might reflect a strength, rather than drawback, of a gro$p decision. The other two choices are both tr$e to some extent, b$t neither identifies a drawback of gro$p decisions, so both choices are incorrect. (iff: ) *age ef: ;) AA6&7: 6omm$nication -b.ective: /.2 11/) @ro$ps decisions are $s$ally AAAAAAAA individ$al decisions. A) more efficient than 7) less efficient than 6) e5$al in efficiency to () more efficient b$t less effective Answer: 7 "xplanation: 7) 7eca$se it takes time to p$t gro$ps together, and it also takes time to get a gro$p to reach agreement, gro$p decisions are almost always more time cons$ming than individ$al decisions. This means that gro$p decisions are less rather than more efficient than individ$al decisions. 3ore efficient b$t less effective is also incorrect beca$se it states that gro$p decisions are less effective than individ$al decisions, a concl$sion for which there is no valid evidence. (iff: ) *age ef: ;) AA6&7: 6omm$nication -b.ective: /.2

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112) &ince all members of a gro$p are rarely e5$al in stat$s, most gro$ps s$ffer from AAAAAAAA. A) minority domination 7) ma.ority domination 6) too m$ch diversity () gridlock Answer: A "xplanation: A) 3inority domination is the res$lt of one, or a few gro$p members asserting their will and opinions over other members of the gro$p, distorting the decision'making process. 3inority domination can diminish the legitimacy of a decision, ca$sing observers to feel that the decision does not reflect a tr$e gro$p consens$s. The other choices here do not match the description. 3a.ority domination wo$ld have a large faction of a gro$p taking over, while too m$ch diversity wo$ld be the opposite of minority domination, and might res$lt in gridlock. (iff: ) *age ef: ;) AA6&7: 6omm$nication -b.ective: /.2 11+) AAAAAAAA can ca$se people in a gro$p to fail to express their tr$e opinions. A) Ambig$o$s responsibility 7) @ro$p imbalance 6) *ress$re to conform () Hears of experience Answer: 6 "xplanation: 6) Individ$als often don:t want to be the =s5$eaky wheel= in a gro$p, so rather than speak $p, they feel press$re to conform and go along with the prevailing gro$p views. Ambig$o$s responsibility might enco$rage, rather than disco$rage, people to speak $p, since it wo$ld allow them to escape conse5$ences for their views. Hears of experience also might enco$rage people to express their views, since experience might make them feel more comfortable in the gro$p. #inally, a gro$p that lacks balance wo$ld not predictably affect how eagerly people in a gro$p speak $p. (iff: ) *age ef: ;) AA6&7: 6omm$nication -b.ective: /.2 119) <hich of the following is a primary characteristic of gro$pthinkB A) conflict among gro$p members 7) fail$re to reach consens$s within a gro$p 6) complete conformity among gro$p members () a gro$p that is candid and open Answer: 6 "xplanation: 6) @ro$pthink is the tendency of gro$p members to conceal their real views and conform to avoid controversy, so it is best described by the choice that highlights conformity. 6onflict or candidness among gro$p members wo$ld not be evident in gro$pthink%in fact the opposite of these conditions wo$ld be likely to prevail: total accord and a lack of openness. #inally, a gro$p that s$ffered from gro$pthink wo$ld likely reach consens$s easier than other gro$ps, making fail$re to reach consens$s within a gro$p an incorrect response. (iff: / *age ef: ;) AA6&7: 6omm$nication -b.ective: /.2
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11;) <hich of the following is D-T a factor that can increase the probability of gro$pthinkB A) Infl$ential gro$p members dominate the disc$ssion and the decision'making process. 7) @ro$p leaders stress the importance of consens$s above all other concerns. 6) The gro$p has more than 24 gro$p members. () @ro$p leaders solicit ideas from all gro$p members witho$t passing .$dgment on their ideas. Answer: ( "xplanation: () @ro$pthink, the tendency of gro$p members to conform in an artificial way, can be the res$lt of overly dominant gro$p leaders, a gro$p that is too large, or too m$ch emphasis p$t on being agreeable. @ro$pthink wo$ld not be likely to res$lt from leaders who solicit ideas from members in a noncritical way, as this wo$ld make gro$p members comfortable in expressing themselves. This makes gro$p leaders soliciting ideas from all members witho$t passing .$dgment the correct response. (iff: / *age ef: ;) AA6&7: 6omm$nication -b.ective: /.2 11,) <hich of the following is the most effective n$mber of people to have in a gro$pB A) +'; 7) )'2 6) 14'1+ () 19')+ Answer: A "xplanation: A) esearch has shown that free expression within a gro$p can be inhibited when a gro$p is either too small or too large. &t$dies have shown that the ideal gro$p si>e has abo$t + to ; participants, making that the correct response. (iff: ) *age ef: ;/ AA6&7: 6omm$nication -b.ective: /.2 111) <hich of the following is $sed to excl$sively generate creative ideas in a gro$p settingB A) brainstorming 7) nominal gro$p techni5$e 6) gro$pthink () electronic meetings Answer: A "xplanation: A) Dominal gro$p techni5$e and electronic meetings are meetings in which gro$ps cannot only generate ideas, b$t also come to decisions, so neither is excl$sively an idea' generating techni5$e. 7rainstorming is $sed excl$sively for generating ideas, so it is the correct response here. @ro$pthink is a negative condition that afflicts gro$ps so it is an incorrect response. (iff: 1 *age ef: ;/ AA6&7: 6omm$nication -b.ective: /.2

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1)4) <hich of the following is D-T allowed in a brainstorming sessionB A) clear definition of the problem 7) criticism or dismissal of poor ideas 6) large n$mber of alternatives () recording of all alternatives Answer: 7 "xplanation: 7) The essence of brainstorming re5$ires that all ideas be treated in ro$ghly e5$al ways. The important thing for brainstorming is simply to generate ideas, not to stand in .$dgment of ideas, which makes criticism or dismissal of poor ideas the correct response. A brainstorming session wo$ld definitely feat$re a clear definition of the iss$e, generation of a large n$mber of alternatives, and the recording of those alternatives for later analysis, so all three of these choices are incorrect. (iff: ) *age ef: ;/ AA6&7: 6omm$nication -b.ective: /.2 1)1) <hich of the following gro$p techni5$es allows gro$p members to meet together, b$t at the same time facilitates independent decision makingB A) brainstorming 7) nominal gro$p techni5$e 6) large meetings of over +4 individ$als () small meetings of less than 14 individ$als Answer: 7 "xplanation: 7) Deither large or small meetings can ens$re independent tho$ght%both meeting forms can fall victim to gro$pthink or domination by a few individ$als. Dominal gro$p techni5$e can generate independent tho$ght, as it allows gro$p members to express opinions secretly so they can be assessed on their own merits. 7rainstorming is an idea'generating techni5$e only, so it cannot res$lt in independent decision making. (iff: ) *age ef: ;/ AA6&7: 6omm$nication -b.ective: /.2 1))) The AAAAAAAA blends the nominal gro$p techni5$e with sophisticated comp$ter technology. A) personal meeting 7) electronic meeting 6) virt$al meeting () preliminary meeting Answer: 7 "xplanation: 7) -f the choices, only the electronic meeting combines the anonymo$s aspect of nominal gro$p techni5$e with comp$ter technology. In an electronic meeting, participants type in comments witho$t identifying themselves, th$s ens$ring that all comments will be taken on an e5$al basis. A personal meeting, virt$al meeting, or preliminary meeting cannot s$pply the anonymity of an electronic meeting, so all three choices are incorrect. (iff: ) *age ef: ;2 AA6&7: 6omm$nication -b.ective: /.2

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1)/) <hat advantages does videoconferencing provide for gro$p decision makingB A) anonymo$s expression of opinions 7) less gro$pthink 6) less minority domination () savings on travel and time Answer: ( "xplanation: () Cideoconferencing is a face'to'face enco$nter so it does not provide anonymo$s expression of opinions, red$ce gro$pthink, or red$ce minority domination. <hat videoconferencing does do is save on travel and time. Individ$als tho$sands of miles away can meet face'to'face witho$t the expendit$re of money and time it wo$ld take to meet in person. This makes savings on travel and time the correct response. (iff: ) *age ef: ;2 AA6&7: 6omm$nication -b.ective: /.2 1)2) 3id'level managers in a co$ntry with high power distance are AAAAAAAA than managers from a low power distance co$ntry. A) more likely to make risky decisions 7) less likely to make risky decisions 6) less likely to make safe, conservative decisions () more likely to disagree with their leaders: decisions Answer: 7 "xplanation: 7) ?igh power distance means that leaders have a disproportionate amo$nt of power when compared to s$bordinates%$s$ally res$lting in mid'level managers making inordinately safe decisions to avoid disapproval from their s$periors. This makes =less likely to make risky decisions= the correct response. &imilarly, high power distance wo$ld decrease, rather than increase, the likelihood of mid'level managers disagreeing with leaders. (iff: 1 *age ef: ;2';+ AA6&7: 6omm$nication -b.ective: /.+ 1)+) 3id'level managers in a co$ntry with low $ncertainty avoidance are AAAAAAAA than managers from a high $ncertainty avoidance co$ntry. A) more likely to make risky decisions 7) less likely to make risky decisions 6) less likely to make foolish decisions () more likely to avoid making decisions Answer: A "xplanation: A) 0ow $ncertainty avoidance means that managers tend not to shy away from $ncertainty%$s$ally res$lting in them being more likely to make risky decisions. 3anagers seeking to avoid risk might avoid making any kind of decision. #oolish decisions might be risky so being less likely to make a foolish decision wo$ld also be incorrect. (iff: 1 *age ef: ;2 AA6&7: 6omm$nication -b.ective: /.+

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1)9) Individ$alistic co$ntries like the !nited &tates tend to have AAAAAAAA than gro$p'oriented co$ntries like Gapan. A) more conformity and more cooperation 7) more conformity and less cooperation 6) less conformity and more cooperation () less conformity and less cooperation Answer: ( "xplanation: () An individ$alistic co$ntry has its strengths and weaknesses. It wo$ld tend to feat$re less cooperativeness Ean overall weakness) and less conformity Ean overall strength) than a more gro$p'oriented c$lt$re. This makes less conformity and less cooperation the correct choice. (iff: 1 *age ef: ;2';+ AA6&7: 6omm$nication -b.ective: /.+ 1);) The $se of ringisei in Gapanese organi>ations reflects which of the following val$es in Gapanese c$lt$reB A) tradition'following 7) consens$s'seeking 6) risk taking () go'it'alone Answer: 7 "xplanation: 7) Ringisei is a reflection of how Gapanese c$lt$re val$es form a consens$s so all participants share the responsibility of a decision. This makes consens$s'seeking the correct choice. Ringisei does not specifically reflect tradition, tho$gh Gapanese c$lt$res do place great val$e on tradition. Ringisei is more or less the opposite of both risk taking and go'it'alone so both of those responses are incorrect. (iff: ) *age ef: ;+ AA6&7: (iversity -b.ective: /.+ 1),) #rench management style tends to be AAAAAAAA in style. A) permissive 7) gro$p oriented 6) r$le following () a$tocratic Answer: ( "xplanation: () #rench managers tend to be domineering in style, highlighting the absol$te a$thority of the s$perior manager. This makes =a$tocratic= the correct response and r$les o$t =permissive= as this is somewhat the opposite of a$tocratic. @ro$p oriented or r$le following management does not fit the #rench style as closely as the correct choice. (iff: ) *age ef: ;+ AA6&7: 6omm$nication -b.ective: /.+

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1)1) <hen dealing with international organi>ations, managers m$st be AAAAAAAA in order to accommodate the managing styles of different c$lt$res. A) as flexible as possible 7) as inflexible as possible 6) as strict as possible () as thoro$gh Answer: A "xplanation: A) #lexibility is the key when dealing with managers from different c$lt$res who may have very different ideas abo$t decision making than domestic managers. This r$les o$t both inflexible and strict beca$se both choices identify a less'flexible approach. Thoro$ghness can be helpf$l, b$t it wo$ld not help avoid mis$nderstanding as m$ch as flexibility in dealing with foreign management. (iff: ) *age ef: ;+ AA6&7: 6omm$nication -b.ective: /.+ 1/4) AAAAAAAA helps people find better sol$tions to problems $sing innovative problem'solving methods. A) *lanning 7) 6reativity 6) -rgani>ation () &tr$ct$re Answer: 7 "xplanation: 7) 6reativity foc$ses on $sing innovation to solve problems $sing novel approaches and methods. <hile planning, organi>ation, and str$ct$re can all aid in problem solving, none of those choices specifically employs innovation%so they are incorrect choices. (iff: ) *age ef: ;+ AA6&7: 6omm$nication -b.ective: /.+ 1/1) According to one st$dy, abo$t AAAAAAAA of men and women were somewhat creative. A) 1 percent 7) 14 percent 6) /4 percent () 94 percent Answer: ( "xplanation: () The st$dy of 291 men and women fo$nd that only abo$t 1 percent of them co$ld be categori>ed as =highly creative,= b$t a f$ll 94 percent were at least =somewhat creative.= This means that 94 percent is the correct response for this 5$estion. (iff: ) *age ef: ;+ -b.ective: /.+

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1/)) -ne well'accepted model states that individ$al creativity re5$ires AAAAAAAA, or a commanding $nderstanding of a s$b.ect matter. A) expertise 7) task motivation 6) high interest () int$ition Answer: A "xplanation: A) A complete $nderstanding of a s$b.ect matter or expertise is a necessary component of creativity, according to the model. Task motivation, high interest, and int$ition are all re5$ired for creativity, b$t none of them describe a thoro$gh $nderstanding of a s$b.ect. (iff: ) *age ef: ;+ -b.ective: /.+ 1//) <hich of the following is D-T a characteristic of a creative problem solverB A) self confidence 7) tolerance for ambig$ity 6) fr$strates easily () accepts risks readily Answer: 6 "xplanation: 6) A creative person has faith in his or her ability to solve problems, can hold conflicting ideas witho$t abandoning them, and will take intellect$al risks. A trait that a creative person cannot have is to be easily fr$strated as the creative process $s$ally re5$ires finding co$ntless =wrong= answers to a 5$estion before a =right= answer emerges. (iff: ) *age ef: ;9 AA6&7: Analytic &kills -b.ective: /.+ 1/2) <hich of the following traits do all creative people seem to shareB A) They like to save time. 7) They get along well with others. 6) They love their work. () They don:t like to work hard. Answer: 6 "xplanation: 6) A large part of creativity is perseverance, so individ$als who do not tr$ly love what they do $s$ally do not have the stamina to solve the problems they are faced with. @etting along well with others and saving time do not help individ$als persevere or aid in the creative process in some other way, so they are incorrect responses. Dot liking to work hard is the opposite of the case for creative people, as they typically work m$ch harder than other people in p$rs$it of their goals. (iff: ) *age ef: ;9 AA6&7: Analytic &kills -b.ective: /.+

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1/+) <hich of the following tends to impede a person:s creativityB A) providing time and reso$rces 7) clearly defined goals 6) being watched while yo$ work () internal motivation Answer: 6 "xplanation: 6) Internal motivation, clearly defined goals, time and reso$rces all serve to increase, rather than decrease creativity. The only item listed that impedes creativity is s$rveillance%being watched%as it p$ts $nd$e press$re on the problem solver and distracts him or her from the goal. That makes being watched while yo$ work the correct response. (iff: ) *age ef: ;9 AA6&7: Analytic &kills -b.ective: /.+ (ecisions, (ecisions E&cenario) &ondra needed help. ?er ins$rance company:s rapid growth was necessitating making some IT changes, b$t what changesB &ho$ld they modify the servers that they c$rrently $sed, or p$rchase an entirely new systemB &ondra was conf$sed and needed help in making the correct decision. 1/9) According to the decision'making process, the first step &ondra sho$ld take is to AAAAAAAA. A) analy>e alternative sol$tions 7) identify decision criteria 6) eval$ate her decision:s effectiveness () identify the problem Answer: ( "xplanation: () The first step in any problem'solving sit$ation is to identify the problem. &ondra:s problem appears to be: sho$ld she b$y a new system or fix the old systemB Identifying decision criteria, analy>ing possible sol$tions, and eval$ating the process will come later in the process. (iff: 1 *age ef: +, AA6&7: Analytic &kills -b.ective: /.1 1/;) &ondra has decided to collect information abo$t the feat$res the company needs for its system. <hich stage of the decision'making process is she carrying o$tB A) identify alternative sol$tions 7) identify decision criteria 6) eval$ate her decision:s effectiveness () allocate weights to the criteria Answer: 7 "xplanation: 7) In collecting information &ondra is identifying the key points, or criteria, that are important to her company. After these criteria are analy>ed, she will go on to identify a list of sol$tions and assign weights to those sol$tions. (iff: ) *age ef: +,'+1 AA6&7: Analytic &kills -b.ective: /.1

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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$tB A) allocation of weights to criteria 7) selecting an alternative 6) implementing the alternative () identifying the problem Answer: A "xplanation: A) In determining that one criterion is more important than another, &ondra is weighting the criteria. 7efore doing that she needed to identify her problem. After assigning weights she will develop and analy>e alternatives, then select an alternative, and finally implement that alternative. (iff: ) *age ef: +,'94 AA6&7: Analytic &kills -b.ective: /.1 1/1) &ondra has decided to p$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 orderB A) analy>ing alternative sol$tions 7) selecting an alternative 6) implementing the alternative () identifying the problem Answer: 6 "xplanation: 6) In deciding on a new system, &ondra selected an alternative. *rior to that she first identified the problem and after identifying criteria, weighting the criteria, and developing alternatives, she analy>ed those alternatives. Dote that selecting an alternative is not the correct response, beca$se in ordering the new system &ondra was going beyond merely selecting an alternative and act$ally implementing the selected alternative, making implementing the alternative the correct response. (iff: / *age ef: +,'94 AA6&7: Analytic &kills -b.ective: /.1 124) The very last step &ondra sho$ld take, according to the decision'making process, is to AAAAAAAA. A) analy>e alternative sol$tions 7) select alternatives 6) implement the alternative () eval$ate the decision:s effectiveness Answer: ( "xplanation: () <itho$t eval$ating the decision, the problem solver is not able to assess whether or not the problem was act$ally solved or the sit$ation was act$ally improved. "val$ating the effectiveness of the decision also allows the decision maker to determine whether or not the correct problem was identified in the first place. All of the other answer choices identify steps that come earlier in the decision'making process. (iff: 1 *age ef: 91 AA6&7: Analytic &kills -b.ective: /.1
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121) 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$st compare the items in order to give them the correct priority in the decision. The most important criterion is assigned the heaviest weight. -ther criteria are assigned weights in comparison with that standard. <eights can be 5$antitative%with n$mber val$es%or determined on a 5$alitative scale. An example of weighting decision criteria is ranking the feat$res of a new car in order of their importance. &tep 2: (evelopment of alternatives The fo$rth step re5$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. (iff: ) *age ef: +,'9) AA6&7: Analytic &kills -b.ective: /.1

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12)) 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$st critically analy>e each alternative. #rom this comparison, the strengths and weaknesses of each alternative become evident. An example of analy>ing alternatives is to make a table of weighted scores for possible new cars. &tep 9: &election of an alternative The sixth step is the important act of choosing the best alternative from among those considered. All the pertinent factors sho$ld be considered here, both ob.ective and s$b.ective. Then a choice of a single alternative%or gro$p of alternatives%sho$ld be selected. An example of selecting an alternative is to choose a single new car from a list of alternatives. &tep ;: Implementation of the alternative Implementation involves carrying o$t the decision that was made. In the car example, it involves p$rchasing the car that was selected. &tep ,: "val$ation of decision effectiveness The last step in the decision'making process involves appraising the o$tcome of the decision to see if the problem has been resolved. (id the alternative chosen and implemented accomplish the desired res$ltB 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$ying decision. <as the right car selectedB (id it have all of the feat$res and characteristics that were neededB (id it perform all of the f$nctions that were neededB (iff: ) *age ef: +,'9) AA6&7: Analytic &kills -b.ective: /.1

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12/) In a short essay, disc$ss why creativity is important to decision making. (escribe a sit$ation in which a creative sol$tion is $sed to solve a problem. Answer: 6reativity is important to decision making beca$se it allows managers to solve problems in more efficient, effective, and innovative ways. Innovation is val$able beca$se it can open $p new paths of exploration for an organi>ation, sometimes exposing needs that weren:t known abo$t and possible opport$nities that weren:t s$spected. An example of a creative sol$tion to a problem is the recent development of a software bowling game for senior citi>ens. ather than try to develop a new game for children or yo$ng ad$lts% two fairly sat$rated markets%the company t$rned its attention to a neglected market, senior citi>ens. 6o$ld the company get seniors%who typically don:t $se comp$ters%to play video gamesB They co$ld if they created the right game. The company worked hard to develop a program that was =friendly= to its typical $ser%a senior citi>en who had no comp$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. 0eag$es have formed. To$rnaments have been organi>ed. &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$ccess of the game is a good example of how being creative can solve a problem. (iff: / *age ef: ;+ AA6&7: Analytic &kills -b.ective: /.+ 122) In a short essay, disc$ss bo$nded rationality and satisficing. Answer: *erfect rationality re5$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 conse5$ences that res$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 conse5$ences. 7o$nded rationality re5$ires the decision maker to satisfice, or choose a =good eno$gh= sol$tion to the problem rather than maximi>e his or her decision by identifying the perfect rational sol$tion. (iff: / *age ef: 92'9+ AA6&7: Analytic &kills -b.ective: /.)

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12+) 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$re is a series of se5$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. Ho$ 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. 3anagers fre5$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 5$ite a bit of interpretation $p to the decision maker. An example of a policy is g$idelines that re5$ire scientists at a research lab have an advanced degree in their field, at least three years of post'doctoral work, and at least five p$blished scientific papers to their credit. These re5$irements are g$idelines%candidates who lack all of the 5$alifications b$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. (iff: ) *age ef: 9,'91 -b.ective: /./

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129) 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$ps have a greater 5$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$p decision'making process is consistent with democratic idealsF therefore, decisions made by gro$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 fre5$ently inefficient. @ro$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$ally harms the 5$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 $p taking =ownership= of the gro$p:s final decision. (iff: ) *age ef: ;1';) AA6&7: 6omm$nication -b.ective: /.2 12;) In a short essay, describe how brainstorming can help avoid gro$pthink and enhance creativity in gro$p decision making. Answer: 7rainstorming is a relatively simple techni5$e for overcoming the press$res for conformity that retard the development of creative alternatives. 7rainstorming $tili>es an idea' generating process that specifically enco$rages any and all alternatives while withholding any criticism of those alternatives. In a typical brainstorming session, participants =freewheel= as many alternatives as they can in a given time. Do criticism is allowed, and all the alternatives are recorded for later disc$ssion and analysis. (iff: ) *age ef: ;/ AA6&7: 6omm$nication -b.ective: /.2

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12,) In a short essay, describe how nominal gro$p techni5$e can help avoid gro$pthink and enhance creativity in gro$p decision making. Answer: Dominal gro$p techni5$e helps gro$ps arrive at a satisfactory sol$tion to a problem. The techni5$e restricts disc$ssion d$ring the decision'making process. @ro$p members m$st be present, as in a traditional committee meeting, b$t they are re5$ired to operate independently. They secretly write a list of general problem areas or potential sol$tions to a problem. The chief advantage of this techni5$e is that it permits the gro$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$ggestions. (iff: ) *age ef: ;/ AA6&7: Analytic &kills -b.ective: /.2 121) In a short essay, describe how electronic meetings can help avoid gro$pthink and enhance creativity in gro$p decision making. Answer: The most recent approach to gro$p decision making blends the nominal gro$p techni5$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. (iff: ) *age ef: ;/';2 AA6&7: Technology -b.ective: /.2 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$lly ob.ective and logical. ?e or she wo$ld caref$lly define a problem and wo$ld have a clear and specific goal. 3oreover, making decisions $sing rationality wo$ld consistently lead toward selecting the alternative that maximi>es 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 organi>ation. That is, the decision maker is ass$med to be maximi>ing the organi>ation:s interests, not his or her own interests. 3anagerial decision making can follow rational ass$mptions if the following conditions are met: the manager is faced with a simple problem in which the goals are clear and the alternatives limitedF the time press$res are minimalF and the cost of seeking o$t and eval$ating alternatives is low. ?owever, most decisions that managers face in the real world don:t meet all of those tests. (iff: ) *age ef: 92 AA6&7: Analytic &kills -b.ective: /.)

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