Question 1

The degrees of correlation between two or more variables can be estimated accurately by such statistical measures as the chi-square test or the Spearman rank-order test.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following is not a way in which Bayes's theorem can improve decision making?

Accepted Answer

A)  Increasing attention to base rates 
B)  Reducing pseudodiagnostic thinking 
C)  Eliminating the confusion of the inverse fallacy 
D)  Helping decision makers adjust initial estimates with new information 
E)  All of the above are way in which Bayes's Theorem can improve decision making.

Question 3

Fault trees would not be helpful for the restaurant management industry due to the nature of the tool.

Accepted Answer

A) True 
 B)False

Question 4

As the need for cognitive closure increases:

Accepted Answer

A)  people consider more alternatives. 
B)  people consider larger amounts of information about each individual alternative. 
C)  people make snap or quick conclusions. 
D)  people become more sensitive to inconsistent evidence. 
E)  people exhibit lower levels of confidence with their decision.

Question 5

People use base rate information when the causal relevance of the information is apparent.

Accepted Answer

A) True 
 B)False

Question 6

According to your readings, the Space Shuttle Challenger tragedy is an example of scenario thinking on the part of NASA.

Accepted Answer

A) True 
 B)False

Question 7

The best way to overcome overconfidence is to focus intensely on one possibility or outcome.

Accepted Answer

A) True 
 B)False

Question 8

Subjective linear modeling would be a good way to select which university to attend for a high school student.

Accepted Answer

A) True 
 B)False

Question 9

In Bayes's Theorem, the likelihood ratio serves as a measure of the probability of a hypothesis being true.

Accepted Answer

A) True 
 B)False

Question 10

Epistemic seizing and freezing generally improves managerial decision making.

Accepted Answer

A) True 
 B)False

Question 11

Research on the framing effect shows that focusing on costs leads decision makers to behave in a risk seeking manner.

Accepted Answer

A) True 
 B)False

Question 12

Intuition follows the rules of Bayes Theorem, which is why intuition is often a good decision tool.

Accepted Answer

A) True 
 B)False

Question 13

The decision aid involving the construction of a key list of inputs for a decision, importance weights for each input, and objective ratings of each input for each decision alternative is known as:

Accepted Answer

A)  an actuarial model 
B)  an objective linear model 
C)  a subjective linear model 
D)  Both a and b are correct. 
E)  None of the above are correct.

Question 14

Subjective linear models:

Accepted Answer

A)  consistently outperform unaided human judgments 
B)  rarely outperform unaided human judgments 
C)  perform about the same as unaided human judgments 
D)  never outperform unaided human judgment 
E)  The data are ambiguous regarding unaided human judgments and linear models

Question 15

Scenario thinking:

Accepted Answer

A)  is harder to handle than statistical decision aids 
B)  leads to good predictions and judgments 
C)  increases the perceived likelihood of an event 
D)  increases manager productivity 
E)  All of the above are correct.

Question 16

An event seems much more likely to occur if when a scenario related to that event is presented or imagined.

Accepted Answer

A) True 
 B)False

Question 17

Bayes's theorem:

Accepted Answer

A)  de-emphasizes base rates 
B)  prevents confusion of the inverse 
C)  can frequently be duplicated by intuitive judgment 
D)  uses only a small amount of information to make its predictions 
E)  All of the above are correct.

Question 18

The Consumer Cost Perception Index is an economic indicator that has historically been inaccurate and has varied greatly due to poor measurement techniques. This measure is:

Accepted Answer

A)  unreliable 
B)  invalid 
C)  insensitive to omission 
D)  actuarial 
E)  convergent

Question 19

When you want to gain cognitive closure quickly, this is known as what component of need for cognitive closure?

Accepted Answer

A)  Convergence 
B)  Seizing 
C)  Unfreezing 
D)  Freezing 
E)  Integrative complexity

Question 20

Fault trees help managers identify the source of a problem quickly.

Accepted Answer

A) True 
 B)False

Exam 18: Strategies for Improving Managerial Decision Making

The degrees of correlation between two or more variables can be estimated accurately by such statistical measures as the chi-square test or the Spearman rank-order test.

Which of the following is not a way in which Bayes's theorem can improve decision making?

Fault trees would not be helpful for the restaurant management industry due to the nature of the tool.

As the need for cognitive closure increases:

People use base rate information when the causal relevance of the information is apparent.

According to your readings, the Space Shuttle Challenger tragedy is an example of scenario thinking on the part of NASA.

The best way to overcome overconfidence is to focus intensely on one possibility or outcome.

Subjective linear modeling would be a good way to select which university to attend for a high school student.

In Bayes's Theorem, the likelihood ratio serves as a measure of the probability of a hypothesis being true.

Epistemic seizing and freezing generally improves managerial decision making.

Research on the framing effect shows that focusing on costs leads decision makers to behave in a risk seeking manner.

Intuition follows the rules of Bayes Theorem, which is why intuition is often a good decision tool.

The decision aid involving the construction of a key list of inputs for a decision, importance weights for each input, and objective ratings of each input for each decision alternative is known as:

Subjective linear models:

Scenario thinking:

An event seems much more likely to occur if when a scenario related to that event is presented or imagined.

Bayes's theorem:

The Consumer Cost Perception Index is an economic indicator that has historically been inaccurate and has varied greatly due to poor measurement techniques. This measure is:

When you want to gain cognitive closure quickly, this is known as what component of need for cognitive closure?

Fault trees help managers identify the source of a problem quickly.