Decision Making Questions and Answers

Answer: D

Correct answer: none of the above.

All three named properties are attributes of useful information. Information that cannot be reached is of no use however good, information arriving after the decision is of no use however accurate, and information not bearing on the question is of no use at all - so none of them is the exception.

Answer: A

Correct answer: systematic

Systematic decision making follows a defined sequence, gathers evidence and evaluates alternatives against stated criteria. It is slower than intuition and more defensible, and it is what a novel or consequential decision warrants - the two are complements rather than rivals.

Answer: C

Correct answer: Limited knowledge and uncertainty

The garbage can model applies where goals are unclear, the technology is not understood and participation shifts - conditions March called organised anarchy. Decisions there are not the outcome of analysis but of problems, solutions and participants meeting at a choice opportunity, which is why solutions sometimes precede the problems they are attached to.

Answer: B

Correct answer: establish specific goals and objectives.

Until it is clear what the decision is meant to achieve, there is no standard against which a problem can be recognised as a problem or an alternative judged better than another. Establishing the goals therefore precedes identifying the problem, which is the second step.

Answer: B

Correct answer: management accounting

Management accounting exists to inform decisions inside the organisation, so it reports whatever helps - financial and non-financial, historical and forecast, at whatever level of detail is useful. Financial accounting reports to those outside and is bound by standards and by the requirement of comparability.

Answer: B

Correct answer: Satisficing

Satisficing is Simon’s companion term to bounded rationality: rather than searching for the best option, the decision maker searches until one is found that is good enough against the criteria that matter, and stops there. The result is acceptable rather than optimal, which is what makes deciding possible at all under real constraints.

Answer: B

Correct answer: programmed decision

Scheduling travel to a conference is a routine and well-understood problem with a known method, so it can be settled by applying the usual procedure. Nothing about it is novel or contentious, which is exactly what makes a decision programmed.

Answer: B

Correct answer: brainstorming.

Brainstorming separates generating ideas from judging them, and the prohibition on criticism is what makes it work: judgement suppresses the unconventional suggestion that might have led somewhere. Evaluation comes afterwards, as a distinct stage with its own rules.

Answer: C

Correct answer: Instinct

Intuitive decision making draws on experience and pattern recognition that the decision maker cannot fully articulate, so it feels like instinct rather than reasoning. It is not guesswork: the judgement rests on a great deal of accumulated experience, which is why an expert’s intuition is worth more than a novice’s.