Decision-Making Techniques: Master Rational and Heuristic Approaches

Question 1

Bounded rationality refers to the idea that decision-makers:

Accepted Answer

Are influenced by cognitive limitations and biases

Answer

Have access to perfect information and unlimited time to make decisions

Answer

Can consider all possible alternatives and their consequences

Answer

Always make optimal decisions

Question 2

Cognitive dissonance occurs when a person experiences discomfort due to:

Accepted Answer

Inconsistent beliefs and actions

Answer

Making a difficult decision

Answer

Receiving positive feedback

Answer

Having their expectations met

Question 3

Which of the following is a characteristic of bounded rationality, rather than rational decision-making?

Accepted Answer

Relying heavily on personal intuition and emotions.

Answer

Gathering and considering relevant information.

Answer

Identifying and evaluating potential alternatives.

Answer

Selecting the alternative with the highest expected value.

Question 4

According to the principles of rational decision-making, what should be considered when making a choice?

Accepted Answer

All potential alternatives, systematically

Answer

Intuition and gut feelings only

Answer

Emotional reactions primarily

Answer

Habitual behaviors without evaluation

Question 5

What is the concept of 'bounded rationality' in decision-making?

Accepted Answer

Human cognitive limitations affect decision-making abilities

Answer

Individuals possess unlimited information processing capabilities

Answer

Decision-making models are always standardized and reliable

Answer

Individuals are prone to overconfidence in their judgments

Question 6

What is the term for the process of assessing the costs and benefits of different options in decision-making?

Accepted Answer

Cost-benefit evaluation

Answer

Prospect analysis

Answer

Linear optimization

Answer

SWOT matrix evaluation

Question 7

Which characteristic is essential for a robust decision-making process?

Accepted Answer

Transparency in documentation and communication

Answer

Ignoring input and perspectives from stakeholders

Answer

Sole reliance on intuition without analysis

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Disregard for ethical considerations

Question 8

What implication does the concept of bounded rationality have on managerial decision-making?

Accepted Answer

Managers often make decisions with limited information and cognitive constraints

Answer

Managers can make error-free decisions consistently

Answer

Managers should strictly adhere to rational decision-making processes

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Managers are incapable of handling complex decision-making situations

Question 9

Which technique can aid managers in mitigating the impact of cognitive biases in decision-making?

Accepted Answer

Devil's advocacy

Answer

Confirmation bias reinforcement

Answer

Availability heuristic application

Answer

Groupthink facilitation

Question 10

Identify an example of a heuristic approach used in decision-making:

Accepted Answer

Applying the 'satisficing' principle

Answer

Creating a weighted decision matrix

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Conducting a thorough cost-benefit analysis

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Consulting multiple experts for advice

Question 11

Which cognitive bias can lead decision-makers to interpret new information in a way that confirms their existing beliefs?

Accepted Answer

Confirmation bias

Answer

Hindsight bias

Answer

Framing bias

Answer

Availability bias

Question 12

Bounded rationality, a limitation in decision-making, is primarily characterized by:

Accepted Answer

Inability to process complex information efficiently

Answer

Tendency to make optimal decisions consistently

Answer

Over-reliance on subjective factors

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Incapability of considering multiple alternatives

Question 13

In decision-making, which ethical consideration emphasizes the accessibility and understandability of the decision-making process?

Accepted Answer

Transparency

Answer

Fairness

Answer

Accountability

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Autonomy

Question 14

Which step in the decision-making process involves identifying the root cause or issue that necessitates a decision?

Accepted Answer

Problem identification

Answer

Alternative generation

Answer

Alternative evaluation

Answer

Decision implementation

Question 15

Which advantage of using a structured approach to decision-making relates to increased clarity and ease of understanding?

Accepted Answer

Improves transparency

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Enhances creativity

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Promotes objectivity

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Reduces time consumption

Question 16

Which challenge in applying decision-making techniques in real-world settings arises due to incomplete or unpredictable information?

Accepted Answer

Uncertainty

Answer

Lack of stakeholder involvement

Answer

Cognitive biases

Answer

Resource constraints

Question 17

Which of the following is a fundamental principle of rational decision-making?

Accepted Answer

Consider all feasible alternatives

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Select the alternative with the least potential risk

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Rely solely on intuition

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Base the decision exclusively on past experiences

Question 18

What is the primary purpose of scenario planning in the decision-making process?

Accepted Answer

To anticipate and assess potential future outcomes

Answer

To minimize uncertainty and mitigate风险

Answer

To develop a detailed and comprehensive plan of action

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To eliminate subjectivity from the decision-making process

Question 19

In the rational decision-making process, what is the initial and most crucial step?

Accepted Answer

Defining the problem or opportunity

Answer

Developing potential solutions and alternatives

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Evaluating and selecting the best alternative

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Implementing the chosen solution

Question 20

How does creativity contribute to the decision-making process?

Accepted Answer

It aids in generating innovative and original solutions

Answer

It reduces the likelihood of making poor decisions

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It is exclusively beneficial for complex and uncertain decisions

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It should be used sparingly to avoid impulsive choices

Question 21

What term describes the constraints on an individual's ability to process information and make decisions?

Accepted Answer

Bounded rationality

Answer

Cognitive dissonance

Answer

Heuristics

Answer

Framing effects

Question 22

Which of the following is not a characteristic of heuristics?

Accepted Answer

Analytical reasoning

Answer

Representativeness

Answer

Availability

Answer

Anchoring and adjustment

Question 23

What is the term for the inclination to favor information that aligns with our existing beliefs?

Accepted Answer

Confirmation bias

Answer

Hindsight bias

Answer

Framing effects

Answer

Availability bias

Question 24

What is the primary benefit of utilizing heuristics in decision-making?

Accepted Answer

Expediency in saving time and effort

Answer

Absolute precision in outcomes

Answer

Eliminating the need for information gathering

Answer

Immunity to cognitive biases

Question 25

Provide an example of bounded rationality in real-world decision-making.

Accepted Answer

A manager making a decision based on limited available data

Answer

A consumer choosing a product influenced by a compelling advertisement

Answer

A scientist conducting a rigorous scientific experiment

Answer

An investor relying on advice from financial experts

Question 26

Which of the following is NOT a core principle of rational decision-making?

Accepted Answer

Making decisions based solely on gut feelings or intuition.

Answer

Evaluating the costs and benefits of different options.

Answer

Gathering and analyzing relevant information.

Answer

Considering the long-term consequences of decisions.

Question 27

Bounded rationality suggests that:

Accepted Answer

Our ability to make perfectly rational decisions is limited by factors like time, resources, and cognitive capacity.

Answer

Rational decision-making is the only effective approach.

Answer

We often make decisions based solely on emotions.

Answer

We always make perfectly rational decisions.

Question 28

Which of the following is a cognitive bias that can lead to irrational decision-making?

Accepted Answer

Confirmation bias (tendency to favor information confirming pre-existing beliefs).

Answer

Random selection.

Answer

Objective evaluation.

Answer

Systematic analysis.

Question 29

In group decision-making, what is the primary role of a facilitator?

Accepted Answer

To guide discussions, ensure everyone has a chance to contribute, and keep the group focused on the task at hand.

Answer

To dominate the discussion and control the group's direction.

Answer

To make the final decision on behalf of the group.

Question 30

What is a key advantage of using technology to support decision-making?

Accepted Answer

Improved access to and analysis of large amounts of data, enabling more informed decisions.

Answer

Increased complexity and confusion in the decision-making process.

Answer

Guarantee of perfectly rational and optimal decisions.

Answer

Elimination of the need for human judgment and intuition.

Question 31

Which of the following is an ethical consideration that should be prioritized when making decisions?

Accepted Answer

Fairness and equity, ensuring that decisions are just and impartial.

Answer

Political expediency, making decisions based on political motivations rather than ethical principles.

Answer

Personal gain, prioritizing individual benefits over collective well-being.

Answer

Short-term profitability, focusing solely on financial gains.

Question 32

A manager is deciding on a new marketing campaign. They conduct market research, analyze customer data, and study competitor strategies. Which decision-making approach is the manager primarily using?

Accepted Answer

Rational decision-making, based on systematic analysis of information and logical reasoning.

Answer

Heuristics, using mental shortcuts to simplify complex decisions.

Answer

Intuition, relying on gut feelings and instincts.

Answer

Bounded rationality, recognizing limitations in information processing and time constraints.

Question 33

A project manager, under time constraints, chooses the first option that meets the basic criteria for a software solution. This scenario demonstrates:

Accepted Answer

Bounded rationality

Answer

Rational decision-making

Answer

Escalation of commitment

Answer

Groupthink

Question 34

Which decision-making pitfall is exemplified when a team avoids presenting alternative solutions to their manager's proposal in order to maintain harmony?

Accepted Answer

Groupthink

Answer

Framing effect

Answer

Confirmation bias

Answer

Availability heuristic

Question 35

A manager is evaluating two investment options: Option A is described as having a potential 30% gain, while Option B is described as having a potential 70% loss. If the manager chooses Option A, this likely demonstrates:

Accepted Answer

Framing effect

Answer

Confirmation bias

Answer

Anchoring bias

Question 36

In the rational decision-making process, what is the initial step?

Accepted Answer

Define the problem

Answer

Generate alternatives

Answer

Gather information

Answer

Evaluate alternatives

Question 37

A company uses a decision tree to analyze potential outcomes of launching a new product. What primary benefit does this technique provide?

Accepted Answer

Visualizing and evaluating possible consequences

Answer

Guaranteeing a successful product launch

Answer

Bypassing the need for data analysis

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Eliminating all risks

Question 38

Which technique can be employed to mitigate the negative effects of groupthink in decision-making?

Accepted Answer

Encouraging dissent and diverse viewpoints

Answer

Promoting conformity and agreement

Answer

Limiting the number of participants

Answer

Suppressing critical evaluation of ideas