Question 1

Which of the following statements depicts the regressiveness principle?

Accepted Answer

A)  Adding two probabilities, p1 and p2, should yield a probability p3 = p1 + p2. 
B)  The utility function of an individual should be either convex or concave. 
C)  Extreme values of a quantity do not deviate very much from the average value of that quantity. 
D)  Except for guaranteed or impossible events, weights for complementary events do not sum to 1. 
A)  Adding two probabilities, p1 and p2, should yield a probability p3 = p1 + p2. 
B)  The utility function of an individual should be either convex or concave. 
C)  Extreme values of a quantity do not deviate very much from the average value of that quantity. 
D)  Except for guaranteed or impossible events, weights for complementary events do not sum to 1.

Question 2

You are going to buy an apartment in Alaska.You have to choose between eleven different proposals.This decision making scenario is an example of a risky choice.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following statements describes the substitutability axiom?

Accepted Answer

A)  The probabilities of two gambles can be interchanged if they are related to each other. 
B)  All sorts of gambles can be interchanged without value exchanges. 
C)  Gambles that have prizes about which people are indifferent are interchangeable. 
D)  If x is preferred to y, then x must be preferred to any probability mixture of x and y. 
A)  The probabilities of two gambles can be interchanged if they are related to each other. 
B)  All sorts of gambles can be interchanged without value exchanges. 
C)  Gambles that have prizes about which people are indifferent are interchangeable. 
D)  If x is preferred to y, then x must be preferred to any probability mixture of x and y.

Question 4

________ involves choosing between two or more readily available options.

Accepted Answer

A)  Risky choice 
B)  Jagged selection 
C)  Decision making under uncertainty 
D)  Riskless choice 
A)  Risky choice 
B)  Jagged selection 
C)  Decision making under uncertainty 
D)  Riskless choice

Question 5

According to the regressiveness principle,extreme values of some quantity deviate to a large extent from the average value of that quantity.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following situations provides an example of the St.Petersburg paradox?

Accepted Answer

A)  A bond offers high returns, but the public interest in it is low. 
B)  Employees are interested in increasing productivity, but their efforts are minimal. 
C)  Managerial productivity is hard to measure, but they get paid more than the others. 
D)  A company's profits have increased in a financial year, but it refuses to pay dividend. 
A)  A bond offers high returns, but the public interest in it is low. 
B)  Employees are interested in increasing productivity, but their efforts are minimal. 
C)  Managerial productivity is hard to measure, but they get paid more than the others. 
D)  A company's profits have increased in a financial year, but it refuses to pay dividend.

Question 7

________ rationality focuses on how people make independent decisions.

Accepted Answer

A)  Game theoretic 
B)  Probabilistic 
C)  Virtual 
D)  Individual 
A)  Game theoretic 
B)  Probabilistic 
C)  Virtual 
D)  Individual

Question 8

Alturo Corporation provides IT products and services in five European countries.Its services include IT infrastructure,maintenance services,and technology-based support services.In an attempt to explore the Asian market,Alturo considers a joint venture with CST Corporation,a Chinese company that provides services and products for computer hardware products.The company initiates negotiations with the executives of CST Corporation.Which of the following pieces of information,if true,would construct a symmetric bargaining situation under this circumstance?

Accepted Answer

A)  Alturo Corporation is financially stronger than CST Corporation and is considering an acquisition also. 
B)  Alturo Corporation has been experiencing a dip in their sales at home and the alliance is very crucial for them to better their performance. 
C)  CST Corporation is expected to benefit more from the joint venture than Alturo Corporation. 
D)  CST and Alturo are large corporations in terms of financial strength and both companies are expected to benefit evenly from the joint venture. 
A)  Alturo Corporation is financially stronger than CST Corporation and is considering an acquisition also. 
B)  Alturo Corporation has been experiencing a dip in their sales at home and the alliance is very crucial for them to better their performance. 
C)  CST Corporation is expected to benefit more from the joint venture than Alturo Corporation. 
D)  CST and Alturo are large corporations in terms of financial strength and both companies are expected to benefit evenly from the joint venture.

Question 9

Decision making under uncertainty refers to a decision making situation where only the probabilities of events are known.

Accepted Answer

A) True 
 B)False

Question 10

Game theoretic rationality focuses on how ________.

Accepted Answer

A)  people make independent decisions 
B)  people make interdependent decisions 
C)  perception influences individual decisions 
D)  people make decisions using their legitimate power 
A)  people make independent decisions 
B)  people make interdependent decisions 
C)  perception influences individual decisions 
D)  people make decisions using their legitimate power

Question 11

People tend to overweight low probabilities and underweight high probabilities.This is referred to as the ________ effect.

Accepted Answer

A)  extremity 
B)  possibility 
C)  utility 
D)  certainty 
A)  extremity 
B)  possibility 
C)  utility 
D)  certainty

Question 12

Which of the following terms is most closely associated with the expected utility theory?

Accepted Answer

A)  decision making under uncertainty 
B)  riskless negotiation 
C)  collective decision making 
D)  rational behavior 
A)  decision making under uncertainty 
B)  riskless negotiation 
C)  collective decision making 
D)  rational behavior

Question 13

Two companies are involved in a discussion regarding the formation of a joint venture company.Both the companies are equally strong financially and stand to gain equally if the negotiation succeeds.This situation is an example of ________.

Accepted Answer

A)  parallel negotiation 
B)  neutral bargaining 
C)  symmetric bargaining 
D)  vertical negotiation 
A)  parallel negotiation 
B)  neutral bargaining 
C)  symmetric bargaining 
D)  vertical negotiation

Question 14

Which of the following,according to Nash's theorem,is a property of the unique solution obtained?

Accepted Answer

A)  Unique point maximizes the geometric average of the gains available to people as measured against their reservation points. 
B)  The agreement point, u, of a negotiation will not satisfy the independence of irrelevant alternatives axiom. 
C)  The bargaining process might yield outcomes that both people find less desirable than some other feasible outcome. 
D)  The Pareto-optimality and symmetry axioms are not used to define the agreement points of a symmetrical game. 
A)  Unique point maximizes the geometric average of the gains available to people as measured against their reservation points. 
B)  The agreement point, u, of a negotiation will not satisfy the independence of irrelevant alternatives axiom. 
C)  The bargaining process might yield outcomes that both people find less desirable than some other feasible outcome. 
D)  The Pareto-optimality and symmetry axioms are not used to define the agreement points of a symmetrical game.

Question 15

You are organizing a team outing to Alabama.You have to make a choice between hunting,fishing,and outing at an amusement park.However,you have little idea about the weather in Alabama and its impact on each of these alternatives.The decision making under these circumstances is an example of ________.

Accepted Answer

A)  riskless choice 
B)  decision making under uncertainty 
C)  probabilistic decision making 
D)  risky choice 
A)  riskless choice 
B)  decision making under uncertainty 
C)  probabilistic decision making 
D)  risky choice

Question 16

A manager's utility function is identified to be a concave curve.Which of the following investment opportunities is likely to be chosen by him?

Accepted Answer

A)  investment in a real estate company that promises attractive returns 
B)  venture capital to a small business, administered by a group of young entrepreneurs 
C)  a bond issued by the federal government that offers guaranteed interest of 2 percent 
D)  investing in a large corporation that is planning to extend its business overseas 
A)  investment in a real estate company that promises attractive returns 
B)  venture capital to a small business, administered by a group of young entrepreneurs 
C)  a bond issued by the federal government that offers guaranteed interest of 2 percent 
D)  investing in a large corporation that is planning to extend its business overseas

Question 17

Which of the following is the first step in the multiattribute utility technique?

Accepted Answer

A)  evaluating the utility of dimensions 
B)  identifying the alternatives 
C)  identifying the attributes of the options 
D)  defining the priorities of dimensions 
A)  evaluating the utility of dimensions 
B)  identifying the alternatives 
C)  identifying the attributes of the options 
D)  defining the priorities of dimensions

Question 18

Which of the following refers to the possibility effect?

Accepted Answer

A)  the tendency to overweight low probabilities and underweight high probabilities 
B)  the tendency to overweight outcomes that are possible relative to outcomes that are impossible 
C)  the tendency to overweight certain outcomes relative to outcomes that are merely probable 
D)  the tendency to remain neutral toward outcomes with low probabilities and high probabilities 
A)  the tendency to overweight low probabilities and underweight high probabilities 
B)  the tendency to overweight outcomes that are possible relative to outcomes that are impossible 
C)  the tendency to overweight certain outcomes relative to outcomes that are merely probable 
D)  the tendency to remain neutral toward outcomes with low probabilities and high probabilities

Question 19

The ________ states that a distinctive solution exists for each bargaining situation.

Accepted Answer

A)  substitutability axiom 
B)  symmetric bargaining principle 
C)  uniqueness axiom 
D)  Pareto-efficient frontier 
A)  substitutability axiom 
B)  symmetric bargaining principle 
C)  uniqueness axiom 
D)  Pareto-efficient frontier

Question 20

Which of the following relationships is true according to the closure property?

Accepted Answer

A)  (x, p, y) = (y, p, x) 
B)  (x, p, y) = (y, 1/p, x) 
C)  (x, p, y) = (y, 1- p, x) 
D)  (x, p, y) = (x, 1/p, y) 
A)  (x, p, y) = (y, p, x) 
B)  (x, p, y) = (y, 1/p, x) 
C)  (x, p, y) = (y, 1- p, x) 
D)  (x, p, y) = (x, 1/p, y)

Which of the following statements depicts the regressiveness principle?

You are going to buy an apartment in Alaska.You have to choose between eleven different proposals.This decision making scenario is an example of a risky choice.

Which of the following statements describes the substitutability axiom?

________ involves choosing between two or more readily available options.

According to the regressiveness principle,extreme values of some quantity deviate to a large extent from the average value of that quantity.

Which of the following situations provides an example of the St.Petersburg paradox?

________ rationality focuses on how people make independent decisions.

Decision making under uncertainty refers to a decision making situation where only the probabilities of events are known.

Game theoretic rationality focuses on how ________.

People tend to overweight low probabilities and underweight high probabilities.This is referred to as the ________ effect.

Which of the following terms is most closely associated with the expected utility theory?

Two companies are involved in a discussion regarding the formation of a joint venture company.Both the companies are equally strong financially and stand to gain equally if the negotiation succeeds.This situation is an example of ________.

Which of the following,according to Nash's theorem,is a property of the unique solution obtained?

A manager's utility function is identified to be a concave curve.Which of the following investment opportunities is likely to be chosen by him?

Which of the following is the first step in the multiattribute utility technique?

Which of the following refers to the possibility effect?

The ________ states that a distinctive solution exists for each bargaining situation.

Which of the following relationships is true according to the closure property?

Negotiation: The Mind and the Heart

Preparation: What to Do Before Negotiation

Distributive Negotiation: Slicing the Pie

Win-Win Negotiation: Expanding the Pie

Developing a Negotiating Style

Establishing Trust and Building a Relationship

Power,Persuasion,and Ethics

Creativity and Problem Solving in Negotiations

Multiple Parties,Coalitions,and Teams

Cross-Cultural Negotiation

Tacit Negotiations and Social Dilemmas

Negotiating Via Information Technology

Nonverbal Communication and Lie Detection

Third-Party Intervention

Negotiating a Job Offer

Filters

Exam 13: Are You a Rational Person Check Yourself

Which of the following statements depicts the regressiveness principle?

You are going to buy an apartment in Alaska.You have to choose between eleven different proposals.This decision making scenario is an example of a risky choice.

Which of the following statements describes the substitutability axiom?

________ involves choosing between two or more readily available options.

According to the regressiveness principle,extreme values of some quantity deviate to a large extent from the average value of that quantity.

Which of the following situations provides an example of the St.Petersburg paradox?

________ rationality focuses on how people make independent decisions.

Decision making under uncertainty refers to a decision making situation where only the probabilities of events are known.

Game theoretic rationality focuses on how ________.

People tend to overweight low probabilities and underweight high probabilities.This is referred to as the ________ effect.

Which of the following terms is most closely associated with the expected utility theory?

Two companies are involved in a discussion regarding the formation of a joint venture company.Both the companies are equally strong financially and stand to gain equally if the negotiation succeeds.This situation is an example of ________.

Which of the following,according to Nash's theorem,is a property of the unique solution obtained?

A manager's utility function is identified to be a concave curve.Which of the following investment opportunities is likely to be chosen by him?

Which of the following is the first step in the multiattribute utility technique?

Which of the following refers to the possibility effect?

The ________ states that a distinctive solution exists for each bargaining situation.

Which of the following relationships is true according to the closure property?

Negotiation: The Mind and the Heart

Preparation: What to Do Before Negotiation

Distributive Negotiation: Slicing the Pie

Win-Win Negotiation: Expanding the Pie

Developing a Negotiating Style

Establishing Trust and Building a Relationship

Power,Persuasion,and Ethics

Creativity and Problem Solving in Negotiations

Multiple Parties,Coalitions,and Teams

Cross-Cultural Negotiation

Tacit Negotiations and Social Dilemmas

Negotiating Via Information Technology

Nonverbal Communication and Lie Detection

Third-Party Intervention

Negotiating a Job Offer

Filters