Deck 3: Managerial Decision Making

Question 1

Aziz is the owner of a record store and must decide on next week's work schedule for his employees. This is an example of a ________ decision.

A)nonprogrammed
B)programmed
C)reprogrammed
D)risky
E)complex

Answer 1

B

Question 2

The most constructive type of conflict is affective conflict.

Answer 2

False

Question 3

When Holden words his suggestions as positively as possible, his managers are more likely to be interested in them because of the bias known as the framing effect.

Answer 3

True

Question 4

Michelle Caldwell, finance manager, told her president, "David, I have determined appropriate revenue recognition for each of the 16 projects this month, based upon company policy and our standard procedures. Each of the projects has routine revenue accrual. I have prepared the monthly financial affidavits for each of these 16 projects, and I recommend that you approve the revenues by signing the affidavits." David's decision to approve the revenues is an example of a programmed decision because the underlying problem

A)is frequent, repetitive, and routine.
B)is novel and unstructured.
C)is trivial.
D)has a predetermined outcome.
E)is risk-free.

Question 5

What is the usual state of affairs in managerial decision making?

A)clear-cut procedures
B)routine situations
C)low risk
D)automatic solutions
E)lack of structure

Question 6

Emil has been going through the decision-making process. He diagnosed a problem with the shipping service his company used, identified alternative shipping services, evaluated those companies, made a choice, and implemented it. Which of the following statements is an accurate description of Emil's decision-making process?

A)Emil has successfully completed the decision-making process.
B)Emil now needs to evaluate the decision he made.
C)Emil left out the first step of the decision-making process.
D)Emil did steps three and four of the decision-making process in reverse order.
E)Emil left out the second step of the decision-making process.

Question 7

If a manager faces a programmed decision, that means

A)a clear structure or procedure exists for arriving at the right decision.
B)the decision maker has no predetermined structure on which to rely.
C)there are unlimited possible solutions, each of which has merits or drawbacks.
D)the decision maker should be creative in choosing what to do.
E)the decision most likely carries substantial risk.

Question 8

Important, difficult decisions that require creative approaches tend to be

A)vigilant decisions.
B)programmed decisions.
C)nonvigilant decisions.
D)nonprogrammed decisions.
E)structured decisions.

Question 9

Yolanda is trying to decide how to diversify her company so that it produces a larger variety of products and competes in new markets. This is a(n)example of a ________ decision.

A)routine
B)programmed
C)cognitive
D)nonprogrammed
E)noncognitive

Question 10

Following all six stages of the decision-making process guarantees successful decisions.

Question 11

Joaquín, a human resources manager, has to lay off either of two department heads, Coral or Mike, because the downsizing process that is going on in the organization calls for the merging of their two departments. However, Joaquín cannot decide whom to lay off, since they are both excellent managers and he does not want to dismiss either of them. In this case, Joaquín is having a difficult time making a decision due to experiencing ________ conflict.

A)interdependence
B)organizational
C)cognitive
D)psychological
E)affective

Question 12

Which of the following decisions is likely to be a nonprogrammed decision?

A)decisions with certainty regarding cause-and-effect relationship
B)decisions concerning diversification into new products and markets
C)decisions regarding rules and definite procedures
D)decisions concerning a merit system for promotion of state employees
E)decisions that depend on numerical computations

Question 13

The executive management team of Regional Health Center has to determine whether the organization should expand to include more advanced (and substantially costlier)treatments and technologies. This is an example of a nonprogrammed decision, because the underlying problem

A)is frequent, repetitive, and routine.
B)is novel and unstructured.
C)is trivial.
D)has a predetermined outcome.
E)is risk-free.

Question 14

Which of the following decisions is likely to be a programmed decision?

A)decisions about diversification into new products and markets
B)decisions with uncertainty regarding cause-and-effect relationships
C)decisions about reorganization of state government agencies
D)decisions regarding periodic reorders of inventory
E)decisions involving the purchase of experimental equipment

Question 15

According to some, the most fundamental unit of value is ideas.

Question 16

Contingency plans should be developed only after a decision has been made and implemented.

Question 17

When a manager must consider opposing pressures from different sources, the manager faces

A)risk.
B)conflict.
C)certainty.
D)groupthink.
E)vigilance.

Question 18

Ariel, a federal government employee, works in acquisition and procurement. Federal policies require that in contracting with suppliers, at least three bids must be received, and the lowest bid that meets specifications will be accepted. In this case, Ariel is dealing with a(n)

A)cognitive conflict.
B)programmed decision.
C)affective conflict.
D)nonprogrammed decision.
E)unstructured problem.

Question 19

The state that exists when the probability of success is less than 100 percent and losses may occur is called

A)conflict.
B)probability analysis.
C)risk.
D)certainty.
E)policy formulation.

Question 20

Which of the following is a characteristic of managerial decisions that contributes to the difficulty in making a decision?

A)guaranteed success
B)certainty
C)conflict
D)structure
E)speed

Question 21

When a solution is specifically designed for a particular problem or set of problems, it is referred to as

A)groupthink.
B)a programmed decision.
C)a ready-made solution.
D)a contingency plan.
E)a custom-made solution.

Question 22

Kent Stevens, regional manager for Quality Transportation, Inc., seeks to purchase a new fleet of delivery trucks for his delivery business. He wants to purchase trucks that are reliable and fuel-efficient, yet reasonably low in price. He selects a truck style that is not the most reliable and fuel-efficient, nor the lost price. However, the truck offers a good combination of attributes that he seeks. Kent's decision best illustrates

A)maximizing.
B)satisficing.
C)optimizing.
D)the coalition model.
E)the incremental model.

Question 23

In an ideal decision-making process, the initial step is to

A)select an alternative.
B)evaluate the decision.
C)challenge the status quo.
D)generate alternatives.
E)identify the problem.

Question 24

When choosing a phone plan, Felix decides on the first option that meets the company's requirements rather than investigating all available options. This is an example of

A)maximizing.
B)compromising.
C)optimizing.
D)satisficing.
E)framing.

Question 25

The manager of the Silver Sands Hotel noticed a tremendous decrease in the number of convention bookings. He promptly ordered the redecoration of the hotel's meeting rooms. Customer feedback later indicated that the problem had not been the meeting facilities but poor service from the cleaning staff. In this scenario, to try and solve the problem, the manager should have first tried to

A)generate alternate solutions.
B)hire more qualified employees.
C)identify the problem.
D)reduce the price of all products.
E)spend more on marketing and advertisement.

Question 26

In the decision-making process, ________ means achieving the best possible balance among several goals.

A)maximizing
B)compromising
C)optimizing
D)satisficing
E)framing

Question 27

Zorah, the manager of a gift shop, needs a fast solution when an employee asks for a day off during the busiest shopping week of the year. A ________ solution will be most helpful to Zorah in this situation.

A)customized
B)ready-made
C)creative
D)personal
E)one-time

Question 28

Celeste is the manager of Classy Clutches, a store that sells designer purses. Celeste knows that the economy greatly affects her business. Therefore, she is developing alternative courses of action for each of the four possible economic outcomes that may occur over the next four to six years. In this scenario, Celeste is

A)implementing a decision.
B)generating contingency plans.
C)making a programmed decision.
D)engaging in satisficing.
E)following the garbage can model.

Question 29

________ requires searching thoroughly for a complete range of alternatives, carefully assessing each alternative, comparing one to another, and then choosing or creating the very best.

A)Benchmarking
B)Maximizing
C)Framing
D)Satisficing
E)Optimizing

Question 30

Gemma, an administrative assistant in the print shop of a large company, orders office supplies biweekly; today, she needs copier paper and ink cartridges. She looks at the office supply catalog and, because the consequences are not huge, quickly picks a selection for each product that is priced acceptably. In this scenario, Gemma is using

A)management by exception.
B)optimizing.
C)satisficing.
D)the garbage can model.
E)maximizing.

Question 31

Once a solution to a problem is chosen, the next phase in the decision-making process involves

A)evaluating alternatives.
B)evaluating consequences.
C)generating information.
D)implementing the decision.
E)generating alternative solutions.

Question 32

Alternative courses of action that can be implemented based on how the future unfolds are referred to as

A)programmed decisions.
B)contingency plans.
C)ready-made solutions.
D)satisficing plans.
E)maximizing plans.

Question 33

Managers at Avalon Computing work in a fast-paced business environment. To make higher-quality decisions in this environment, Avalon's managers do not use traditional tactics, e.g., relying on old data, long-range planning, and futuristic forecasts. Instead, they focus on real-time information, by constantly monitoring daily operating measures such as work in process rather than checking periodically the traditional accounting-based indicators such as profitability. In this manner, Avalon's managers strive to overcome the barrier to effective decision making known as

A)illusion of control.
B)framing effects.
C)discounting the future.
D)time pressures.
E)social realities.

Question 34

Managers who optimize their decisions will attempt to

A)choose the first, minimally acceptable alternative.
B)select the decision that is fastest to make.
C)find the least expensive option available in the market.
D)decide on whatever produces the least challenge or conflict.
E)achieve the best possible balance among several goals.

Question 35

"We have 75 qualified candidates for the quarterly training program but only 25 slots," said Toby Spencer, production manager. "In that case, randomly select 25, and we will train the other candidates later this year during the next rounds of training," said Amelia Stone, division manager. By selecting 25 qualified candidates at random rather than determining the 25 most qualified candidates, the managers engaged in

A)ignoring.
B)satisficing.
C)favoring.
D)optimizing.
E)maximizing.

Question 36

The final phase in the decision-making process is

A)anticipating the results.
B)implementing the solution.
C)diagnosing remaining issues.
D)criteria analysis.
E)evaluating the decision.

Question 37

Kai needs to hire a new landscaping service to take care of the small garden outside his dental office. He knows what tasks he wants done and how much he is willing to pay per week, and he hires the first service that agrees to his terms. Such an action is referred to as

A)optimizing.
B)satisficing.
C)maximizing.
D)minimizing.
E)framing.

Question 38

Negative feedback received during the final evaluation of the decision either means that ________ or the decision was a bad one.

A)the problem cannot be solved
B)more financing is required to implement the changes
C)the manager is not capable of rational decisions
D)implementation will require more time
E)not enough resources were allocated to the problem

Question 39

Vigilance in decision making means the

A)customer realizes increased value as a result of the decision.
B)manager has carefully completed all stages in the decision-making process.
C)manager has overdone the decision-making process.
D)employees have full control over the decision-making process.
E)employees have been monitored to see their reactions to the decision.

Question 40

Safa has identified a problem that consists of a gap between what her company is doing now and what it can do to create a more profitable future. The "problem" that Safa has identified is also a(n)

A)opportunity.
B)danger.
C)benefit.
D)trap.
E)secret.

Question 41

Which of the following is a disadvantage of group decision making?

A)drawing on more perspectives
B)having a larger pool of information
C)understanding the decision
D)experiencing groupthink
E)being more committed to a decision

Question 42

Parker believes that as long as he pays good wages and treats his workers fairly, he can keep employee turnover to a minimum even though his store is located in a community that is known for having a transient population. Parker's belief is an example of which of the following psychological biases?

A)illusion of control
B)framing effects
C)discounting the future
D)time pressure
E)social realities

Question 43

Which of the following involves weighting short-term costs and benefits more heavily than longer-term costs and benefits?

A)framing effects
B)cognitive conflict
C)illusion of control
D)social realities
E)discounting the future

Question 44

"Suzette, we must jump into this new business area now, or we will fall behind," argued Cameron. "Let's price our product well below our competitors' prices, even if we don't make money at first. We will figure out how to make money later." Cameron is guilty of

A)illusion of control.
B)framing effects.
C)discounting the future.
D)bargaining.
E)benchmarking.

Question 45

The belief that one can influence events even when one has no power over what will happen is known as

A)framing effects.
B)discounting the future.
C)illusion of control.
D)affective conflict.
E)cognitive conflict.

Question 46

Illusion of control, discounting the future, and framing effects are all examples of

A)social realities.
B)psychological biases.
C)goal displacement.
D)vigilance.
E)time pressures.

Question 47

Real-time information is information that

A)is obtained with little or no delay.
B)is based only on past performance.
C)focuses on futuristic forecasts.
D)is based on adjusted predictions.
E)is discounted for the future.

Question 48

The psychological bias known as "illusion of control" refers to a belief that

A)the employees will always agree with the decisions made by the manager.
B)one can influence events even when one has no control over what will happen.
C)employees do not have confidence in a manager's abilities.
D)one has no control and therefore does not put any effort into the decision.
E)managers with wider spans of control tend to perform effectively.

Question 49

Kyoshi sought the collective wisdom of his management team to make a decision. His team had to decide if self-driving cars, space travel, or gene splicing would be their next major investment. He brought together his managers in a meeting. Haruki used his strength of character and oratory skills to push for solar panel research. The other managers were quiet, and Haruki overpowered them with his views. Given the dynamics of the meeting and its outcome, ________ had prevented Kyoshi's meeting from achieving what he had hoped it would.

A)groupthink
B)satisficing
C)domination
D)devil's advocacy
E)goal displacement

Question 50

During a managers' meeting, there is difficulty reaching a decision on which project to fund in the upcoming year. In arguing for funding for her project, Valentina states that she has experience in making all projects succeed. She even states that she is immune to failure. Valentina is displaying

A)illusion of control.
B)framing effects.
C)discounting the future.
D)bargaining.
E)benchmarking.

Question 51

"My idea will make us a lot of money, and it's by far the best idea offered!" John exclaimed. His division manager replied, "I agree that your idea has promise. However, your idea has no supporting data or facts. Meanwhile, your two colleagues submitted business plans for their ideas that specified gains of 15 and 22 percent, respectively, and their plans were submitted last week before the deadline expired." John was using ________ to advance his position.

A)illusion of control
B)framing effects
C)discounting the future
D)groupthink
E)devil's advocacy

Question 52

Which of the following is a decision bias influenced by the way in which a problem or decision alternative is phrased or presented?

A)groupthink
B)satisficing
C)goal displacement
D)framing effects
E)illusion of control

Question 53

Which of the following is the best example of a manager discounting the future?

A)a manager believing that he or she can control the outcome of any decision
B)a manager planning for the long-term stability of a company
C)a manager depending on programmed decisions for all issues
D)a manager framing the decision alternatives to influence selection
E)a manager focusing on quarterly profits instead of the long-term vision

Question 54

Terra is the owner of Arcadia Salon and Spa and is looking to add some new spa services. Terra interviewed her staff to get their opinions and ideas, and she invited everyone to participate in deciding which ideas to advance. Staff members were then aware of the various options and recognized the benefits and costs of each. In this scenario, involving the staff has helped people to

A)dominate the discussion.
B)use groupthink to gain buy-in.
C)please everyone completely.
D)believe in the illusion of control.
E)understand the decisions.

Question 55

In goal displacement, a decision-making group

A)loses sight of its original goal and a new, less important goal emerges.
B)becomes so eager to avoid conflict that it adopts a goal or decision too quickly.
C)generates as many goals as it can but does not allow criticism of people or ideas.
D)disagrees on goals, or the members compete with one another for resources.
E)is unsure about goals and is in disagreement about what to do.

Question 56

Which of the following statements about group decision making is true?

A)Group decisions should rarely be used to address significant business problems.
B)Individual decisions are generally more difficult to reach than group decisions.
C)If enough time is available, groups usually make higher-quality decisions than most individuals.
D)If enough time is available, most individuals usually make higher-quality decisions than a group.
E)There are far more disadvantages than advantages to group decision making.

Question 57

Discounting the future refers to

A)valuing long-term benefits and costs more heavily than short-term benefits and costs.
B)overestimating the long-term effects of the decision.
C)underestimating the short-term effects of the decision.
D)valuing short-term benefits and costs more heavily than longer-term benefits and costs.
E)making quick decisions with whatever information is at hand.

Question 58

Which of the following is a psychological bias that can act as a barrier to good decision making?

A)framing effects
B)affective conflict
C)cognitive conflict
D)groupthink
E)dialectic

Question 59

Each morning, Atlas Hardware's CEO has a computer-based conference with all store managers. The previous day's data and challenges are discussed so that problems can be quickly and effectively resolved or even avoided. In this case, Atlas Hardware is utilizing ________ to retain a competitive edge.

A)social realities
B)real-time information
C)psychological biases
D)framing effects
E)nonprogrammed decisions

Question 60

________ is an advantage of using a group for decision making.

A)Intellectual stimulation
B)Domination by one member
C)Groupthink
D)Satisficing
E)Goal displacement

Question 61

Which of the following is a disadvantage of group decisions?

A)People tend to settle for satisficing.
B)There is a smaller pool of information.
C)The employees are not intellectually stimulated.
D)There are multiple perspectives to the decision.
E)There is more transparency among employees.

Question 62

The three requirements for effective group decision making are an appropriate leadership style, the constructive use of disagreement and conflict, and the enhancement of

A)conflict.
B)groupthink.
C)satisficing.
D)creativity.
E)framing.

Question 63

Groups that are excessively concerned with maintaining a positive team spirit are likely to experience

A)individual dominance.
B)goal displacement.
C)brainstorming.
D)groupthink.
E)maximizing.

Question 64

Dario and Jordan, assistant managers at Lakeside Steakhouse, constantly disagree with each other. Lately, the arguments have become personal, leading to anger and bitterness, and this has begun to impact everyone at the restaurant. Which of the following best describes the given scenario?

A)bounded rationality
B)affective conflict
C)garbage can model
D)individual dominance
E)groupthink

Question 65

Neal, European division manager, instructed his direct reports to meet without him to collectively discern the top 12 percent of all division employees who were worthy of promotion. Arguments ensued, as the managers stubbornly championed their own subordinates and blindly criticized their peers' subordinates. The managers were unable to select the top 12 percent of the entire staff for promotion. Instead, they reported back to Neal that they wanted to promote all of the candidates, representing 35 percent of all employees. In failing to make a group decision to use discernment in identifying the top 12 percent as instructed by Neal, the managers were guilty of

A)goal displacement.
B)individual dominance.
C)satisficing.
D)groupthink.
E)social loafing.

Question 66

________ occurs when a group member is more interested in winning an argument than solving a problem.

A)Framing
B)Goal displacement
C)Groupthink
D)Satisficing
E)Synergy

Question 67

In trying to make a conflict between two employees less personal and emotional, their manager asks each of them to approach the problem from a different viewpoint than their original one. This is an example of encouraging the use of

A)cognitive conflict.
B)affective conflict.
C)psychological conflict.
D)custom-made solutions.
E)groupthink.

Question 68

Emotional disagreement directed toward other people is known as

A)psychological bias.
B)affective conflict.
C)cognitive conflict.
D)bounded rationality.
E)framing effect.

Question 69

Which of the following is the most constructive type of conflict?

A)emotional conflict
B)affective conflict
C)cognitive conflict
D)unstructured conflict
E)framing conflict

Question 70

Allowing one person to control a discussion or decision is known as

A)groupthink.
B)devil's advocacy.
C)individual dominance.
D)vigilance.
E)dialectic.

Question 71

Eva and Brendan disagree sharply about a proposed solution because their backgrounds have given them radically different perspectives. This is an example of

A)goal displacement.
B)affective conflict.
C)cognitive conflict.
D)bounded rationality.
E)framing effect.

Question 72

A phenomenon that occurs in decision making when group members avoid disagreement as they strive for consensus is known as

A)goal displacement.
B)domination.
C)intuition.
D)groupthink.
E)satisficing.

Question 73

Imani, a manager at Scribbles Specialty Paper Company, was disappointed with her team's discussion regarding next year's marketing campaign. Van, a fellow manager, pushed all his ideas through; they were good, but nobody else got a word in or had the opportunity to share. This group experienced

A)vigilance.
B)individual dominance.
C)satisficing.
D)intellectual stimulation.
E)goal displacement.

Question 74

________ conflict is differences in perspectives or judgments about issues.

A)Affective
B)Intellectual
C)Cognitive
D)Emotional
E)Judgmental

Question 75

A condition that occurs when a decision-making group loses sight of its original goal and a new, possibly less important, goal emerges is known as

A)goal displacement.
B)groupthink.
C)a framing effect.
D)goal alignment.
E)goal realization.

Question 76

Robby decided to introduce conflict into his planning meeting, to stimulate intellectual discussion of different perspectives on issues. Robby believed that this was necessary because his subordinates were engaging in ________, that is, avoiding disagreement for the sake of remaining cordial.

A)goal displacement
B)satisficing
C)domination
D)devil's advocacy
E)groupthink

Question 77

Taryn, the manager of a graphic design firm, realizes that during meetings people feel strong inhibitions about disagreeing, but when conflicts arise, they become personal and emotional. Taryn has therefore assigned Boris, a colleague, the task of pointing out problems and criticizing ideas to ensure that their downsides are fully explored. Which of the following best describes the procedure used in this scenario?

A)garbage can model
B)devil's advocacy
C)individual dominance
D)illusion of control
E)discounting the future

Question 78

Which of the following best describes the dialectic method of managing group decision making?

A)A group intentionally makes negative arguments to force investigation of the idea under consideration.
B)A group holds a structured debate about two conflicting courses of action.
C)Conflict generated within the group is minimized by enforcing group unity.
D)Group conflict is maximized by including both factual counterarguments and personal attacks.
E)The leader performs the role of peacekeeper when attacks are directed at individuals.

Question 79

Leaders of decision-making groups should

A)discourage cognitive conflict.
B)encourage groupthink.
C)help the group satisfice.
D)ask for members' opinions.
E)dominate the discussion.

Question 80

When a group accepts an alternative that seems to please the members of the group, but the group has not taken the time or effort to explore many options, the group has

A)exercised groupthink.
B)stimulated the intellects of its members.
C)made an optimizing decision.
D)exercised vigilance.
E)participated in goal displacement.