Management, 14e (Robbins/Coulter)
Chapter 2 Making Decisions
1) A problem can best be described as ________.
A) a change from the past
B) something bad that has happened
C) a difference between current conditions and some desired state
D) a loss of something of value
2) Which of the following statements is true concerning problem identification?
A) Problems are generally obvious.
B) A symptom and a problem are one and the same.
C) Generally, what is a problem for one manager is a problem for all other managers.
D) Effectively identifying problems is not easy.
3) Sales of the high-end units have declined. The owners want Arnold, the CEO, to increase
revenues to previous levels. His first action should be ________.
A) to identify previous sales levels
B) to determine why sales are off
C) to compare costs for three new models under development
D) to immediately begin production on the lowest cost model
4) Ridership on the city’s public transportation buses has fallen for three weeks in a row. This is
________.
A) a problem
B) a symptom
C) neither a problem nor a symptom
D) a condition, but we need more information to determine whether it is a problem or a
symptom.
5) After identifying a problem, the next step in the decision-making process is ________.
A) identifying decision criteria
B) allocating weights to decision criteria
C) analyzing alternatives
D) developing alternatives
6) To determine the ________, a manager must determine what is relevant or important to
resolving a problem.
A) bounded rationality of a decision
B) escalation of commitment
C) cost of implementation
D) decision criteria
7) Belinda wants to introduce a new model to the product line. Three models are being
developed. Belinda can choose only one. She has decided to focus on target market size,
production costs, and net profits. These are Belinda’s ________.
A) alternatives
B) criterion weights
C) decision criteria
D) problems
8) Amanda, a single parent, is looking for a new job. Considering that she has two school-aged
children, she is particularly keen on finding an employer who can provide her with alternative
work arrangements such as flexible work hours and telecommuting. In terms of the decision-
making process, these represent Amanda’s ________.
A) decision criteria
B) problems
C) alternatives
D) heuristics
9) Max is planning to go away to college next year and is currently trying to figure out to which
colleges he should apply. He would like to major in English Literature at an accredited liberal
arts college, but is also looking for a university that offers financial aid. In terms of the decision-
making process, these represent Max’s ________.
A) problems
B) alternatives
C) decision criteria
D) heuristics
10) After identifying the decision criteria that are important or relevant to resolving a problem,
the next step in the decision-making process is ________.
A) allocating weights to the criteria
B) analyzing the alternatives to solving the problem
C) reducing the number of criteria through the process of elimination
D) implementing the alternative
11) Bryan must select a new supplier for lighting fixtures for his company’s mobile homes. He
has decided quality is more important than price but price is more important than lead times.
Bryan will use these priorities to ________.
A) analyze alternatives
B) set his decision criteria
C) allocate weights to the criteria
D) develop alternatives
12) Creativity is most essential in which of the following steps of the decision-making process?
A) analyzing alternatives
B) allocating weights to the decision criteria
C) developing alternatives
D) identifying decision criteria
13) Carla is searching the Internet for sources of Himalayan salt to make bath salts. Carla is at
the ________ step in the decision making process.
A) identify-the-problem
B) identify-decision-criteria
C) allocate-weights
D) develop-alternatives
14) When the overhead cranes crashed into each other for the third time, Joe formed a team to
look into ways to avoid future crashes. After a brainstorming session, the team settled on three
ideas, any of which might work. The team has completed which step in the decision-making
process?
A) develop alternatives
B) analyze alternatives
C) select an alternative
D) implement an alternative
15) Carla has identified several possible sources for Himalayan salt to make her bath salts. Now
she is comparing their prices, quality, and delivery times. At what step is she in the decision-
making process?
A) develop alternatives
B) analyze alternatives
C) select an alternative
D) implement the alternative
16) Carla discovered that the supplier with the highest quality also had the longest lead time. The
supplier with the best lead time had the highest price. To help Carla make her decision, she
should ________.
A) order a small quantity from each supplier for comparison
B) rely on customer reviews to guide her decision
C) multiply her ratings for each criteria by the weight for the criteria then sum the scores
D) check with the Better Business Bureau for customer complaints
17) After Abby listened to the weather report this morning before work, she drove her car and
carried an umbrella instead of riding her motorcycle. Whether she realizes it or not, Abby
________.
A) analyzed criteria
B) implemented a decision
C) assigned weights to criteria
D) evaluated a decision
18) In the decision-making process, while ________, the decision maker puts the decision into
action by conveying it to those affected by it and getting their commitment to it.
A) selecting an alternative
B) evaluating a decision’s effectiveness
C) implementing an alternative
D) analyzing alternatives
19) Which of the following is important in effectively implementing the chosen alternative in the
decision-making process?
A) evaluating each alternative by using the established criteria
B) being creative while implementing the alternatives
C) allowing those impacted by the outcome to participate in the process
D) ignoring criticism concerning your chosen alternative
20) Before actually putting the decision into action, the decision-maker may find it prudent to
________.
A) develop the method of evaluating whether the decision is a good one
B) notify upper management that change is coming so they won’t be blindsided
C) alert external stakeholders that the problem has been solved
D) check to make sure the conditions that existed at the time of the decision still exist, and make
sure the decision is still the best one
21) The final step in the decision-making process is to ________.
A) determine the criteria for the next decision
B) analyze the process of allocating weights to the decision criteria
C) evaluate the outcome of the decision
D) implement the chosen alternative
22) Joe’s team implemented one of the ideas to avoid crane crashes. It is important for the team
to evaluate the results because ________.
A) the team was not sure their idea would work
B) the team wants to impress the plant manager
C) results may vary from expectations
D) another crane crash could cost the team their jobs
23) The decision-making process begins by identifying decision criteria.
24) A decision criterion defines what is important or relevant to resolving a problem.
25) In the decision-making process, after allocating weights to the decision criteria, the decision
maker lists viable alternatives that could resolve the problem.
26) Once the alternatives to solving a problem have been identified, the next step in the decision-
making process is selecting one of these alternatives.
27) Implementing an alternative refers to the process of choosing the best alternative.
28) List and discuss the eight steps in the decision-making process.
29) Managers are assumed to use ________ if they make logical and consistent choices to
maximize value.
A) rational decision making
B) intuitive decision making
C) bounded rationality
D) evidence-based management
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30) Dylan must choose among four candidates to fill his open accounting clerk position. If Dylan
uses rational decision making, he will ________.
A) disregard the fact the one of the candidates is the owner’s nephew
B) rely on his initial impressions of the candidates to make this decision
C) base his decision on his extensive experience and accumulated judgment
D) involve others in the interviewing process
Answer: A
Diff: 3
AACSB: Reflective thinking
Learning Obj: LO 2.2: Explain the four ways managers make decisions
Classification: Concept
31) It is assumed that a rational decision maker ________.
A) faces unclear and ambiguous problems
B) is unlimited by his or her ability to process information
C) is unaware of all the possible alternatives and consequences
D) is fully objective and logical
Answer: D
Diff: 2
AACSB: Reflective thinking
Learning Obj: LO 2.2: Explain the four ways managers make decisions
Classification: Concept
32) When managers make decisions that are rational but limited by their ability to process the
information, they are following the concept of ________.
A) cognitive decision making
B) bounded rationality
C) escalation of commitment
D) intuitive decision making
Answer: B
Diff: 1
AACSB: Reflective thinking
Learning Obj: LO 2.2: Explain the four ways managers make decisions
Classification: Concept
33) Evelyn’s Internet search for information about “vendor for machine screws” yielded more
than 100,000 items. Evelyn did not have time or resources to pursue each of these so she limited
her search to only vendors in her state. By doing this, Evelyn used ________.
A) perfect rationality
B) bounded rationality
C) satisficing
D) intuition
Answer: B
Diff: 2
AACSB: Application of knowledge
Learning Obj: LO 2.2: Explain the four ways managers make decisions
Classification: Application
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Copyright © 2018 Pearson Education, Inc.
34) Managers cannot possibly analyze all information on all alternatives; they tend to ________,
rather than ________.
A) maximize; satisfice
B) neutralize; satisfice
C) satisfice; neutralize
D) satisfice; maximize
Answer: D
Diff: 1
AACSB: Reflective thinking
Learning Obj: LO 2.2: Explain the four ways managers make decisions
Classification: Concept
35) ________ results in a solution that is considered “good enough.”
A) Escalating
B) Linear thinking
C) Intuition
D) Satisficing
Answer: D
Diff: 1
AACSB: Reflective thinking
Learning Obj: LO 2.2: Explain the four ways managers make decisions
Classification: Concept
36) Gilda has an idea that would streamline operations, reduce costs, and increase profits. Her
idea requires the cooperation of several departments, some of which have demonstrated a
resistance to change. By considering the context in which the changes must happen and the
people in her organization, Gilda is using ________.
A) evidence-based management
B) bounded rationality
C) intuition
D) positive employee relations
Answer: A
Diff: 2
AACSB: Reflective thinking
Learning Obj: LO 2.2: Explain the four ways managers make decisions
Classification: Application
37) Abigail is shopping for a new copier for her company. She has set her price range between
$5,000 and $6,000. The copier must handle a minimum of 10,000 copies per month and have a
useful life expectancy of five years. If Abigail selects the first copier she finds that meets these
criteria, we would say she is ________.
A) using perfect rationality
B) using bounded rationality
C) using intuition
D) satisficing
38) Julie is keen on joining Columbia University to pursue a master’s degree in economics.
However, after three months of applying and waiting for an acceptance letter, she finally decides
to attend NYU, which was one of her backup colleges. This is an example of ________.
A) maximizing
B) neutralizing
C) minimizing
D) satisficing
39) Edgar hired a graduate from his alma mater, thinking he would be a successful first line
supervisor. Unfortunately the new hire hasn’t worked out as well as hoped. Edgar decided to
invest time and money in training for the new hire but saw little improvement. Next he assigned
a successful supervisor to mentor the young employee. The problems persisted. Edgar is
displaying ________.
A) bounded rationality
B) irrational behavior
C) poor judgment
D) escalation of commitment
40) Farrell has a knack for selecting candidates who become very successful workers. When
asked how he does it, he answered that he “listened to his gut.” Farrell is really ________.
A) using his intuition
B) using bounded rationality
C) using perfect rationality
D) satisficing
41) Which of the following is an aspect of intuition?
A) experience-based decisions
B) quality-initiated decisions
C) science-based decisions
D) programmed decisions
42) Intuitive decision making ________.
A) is the systematic use of the best available evidence to improve decision making practice
B) generally results in poor decisions and hence managers should learn to ignore their gut
feelings
C) is the process of making decisions based on experience, feelings, and accumulated judgment
D) complements rational decision making but not bounded rational decision making
43) Farrah has called together her management team to review information about customer
satisfaction gathered by an external research company. Farrah is engaging in ________.
A) perfect rationality
B) bounded rationality
C) evidence-based management
D) relationship management
44) Managers use decision-making in every function, from planning to controlling.
45) It is important that decision-makers ignore emotions when making business decisions so
their decisions will be perceived as rational.
46) One assumption of rational decision making is that the decision maker is not aware of all
possible alternatives and consequences.
47) According to the concept of bounded rationality, managers make decisions rationally, but are
limited by their ability to process information.
48) The phenomenon of escalation of commitment refers to an increased commitment to a
previous decision despite evidence that it may have been wrong.
49) Intuitive decision making complements rational decision making but not bounded rational
decision making.
50) Briefly, discuss the assumptions of rationality and the validity of those assumptions.
51) What is meant by bounded rationality and satisficing?
52) Give an example of the use of bounded rationality. The example can be fictitious as long as it
includes all the elements of bounded rationality.
53) What is intuitive decision making? How does intuition affect the process of making a
decision?
54) Give an example of evidence-based management. Remember to include all of the essential
elements.
55) ________ are straightforward, familiar, and easily defined.
A) Programmed problems
B) Structured problems
C) Non-structured problems
D) Nonprogrammed problems
56) Garrett looked at the list of orders for the coming week and made out the production
schedule. He has done this so many times he could do it in his sleep. This situation represents
a(n) ________.
A) structured problem
B) unstructured problem
C) linear problem
D) programmed problem
57) Structured problems align well with which type of decisions?
A) programmed
B) analogous
C) organic
D) nonlinear
58) A(n) ________ decision is a repetitive decision that can be handled by a routine approach.
A) nonprogrammed
B) structured
C) unstructured
D) programmed
59) Harriet’s machine has stopped working again. She consulted the operator’s manual
troubleshooting guide to find a solution. Harriet used a ________.
A) programmed decision
B) non-programmed decision
C) structured decision
D) non-structured decision
60) When making a decision for a routine situation, which step in the decision making process
can be skipped?
A) identify the problem
B) evaluate decision effectiveness
C) develop alternatives
D) implement the alternative
61) A procedure is ________.
A) an explicit statement that tells a manager what can or cannot be done
B) a series of sequential steps a manager uses to respond to a structured problem
C) used mainly for unstructured, rather than structured, problems
D) subject to the interpretation of the decision maker
62) One of the workers in Henry’s department submitted his two weeks’ notice so Henry needs to
hire a replacement. The HR department issued a set of instructions Henry must follow to initiate
the search for candidates. In other words, there is a ________ Henry must follow.
A) policy
B) practice
C) procedure
D) program
63) A(n) ________ is an explicit statement that tells a manager what can or cannot be done.
A) agenda
B) objective
C) rule
D) solution
64) “All employees must be at their work stations and ready to work by the time the buzzer
sounds.” This is an example of ________.
A) a policy
B) a procedure
C) a practice
D) a rule
65) “Smoking and the consumption of alcohol are strictly prohibited inside the work Premises.”
This is most likely an example of a(n) ________.
A) rule
B) objective
C) procedure
D) policy
66) A policy ________.
A) typically serves as a guideline for decision making by setting general parameters
B) specifically states what should or should not be done
C) is a series of sequential steps a manager uses to respond to a structured problem
D) is used when dealing with unstructured problems and non-programmed decisions
67) “We expect to maintain the highest standards of quality in our workmanship.” This is an
example of ________.
A) a procedure
B) a rule
C) a policy
D) a practice