Chapter 2: Decisions

Which of the following lists the 8-step decision making process in the correct order?

• Identifying a problem, identifying the decision criteria, allocating weights to the criteria, developing alternatives, analyzing the alternatives, selecting an alternative, implementing the alternative, and evaluating decision effectiveness.

• Identifying a problem, identifying the decision criteria, developing alternatives, allocating weights to the criteria, analyzing the alternatives, selecting an alternative, implementing the alternative, and evaluating decision effectiveness. 

• Identifying a problem, identifying the decision criteria, allocating weights to the criteria, developing alternatives, analyzing the alternatives, selecting an alternative, evaluating decision effectiveness, and  implementing the alternative.

• None of the above are correct.

When the relevant criteria in a decision are not equal, it is appropriate to allocate weights to each criteria. 

• True

• False

The statement that "managers make decisions rationally but are limited by their ability to process information" is the definition of ..............................

• Rational decision making

• Bounded rationality

• Satisficing

• Escalation of commitment

When managers satisfice, they accept solutions that are good enough. 

• True

• False

What kind of decision is a manager making when based on feelings or past experience? 

• Intuitive decision

• Structured decision

• Satisficed decision

• Evidence-based decision

Structured problems are straightforward, familiar, and easily defined.

• True

• False

When addressing a structured problem, a manager will typically rely upon a programmed decision including procedures, rules, and ____________________.

• Intuition

• Design thinking

• Satisficing

• Policies

A framing bias occurs when decision makers seek out information that reaffirms their past choices and discounts information that contradicts past judgments. 

• True

• False

A randomness bias describes the actions of decision makers who try to create meaning out of random events. 

• True

• False

Design thinking ...................................

• Relies upon big data analysis for finding non-intuitive solutions to complex problems

• Is an effective decision-making approach that is typically free from biases. 

• Begins by asking "what is something completely new that would be lovely if it existing but doesn't now".

• Is associated with artificial intelligence and advanced analytics