Decision Making Questions and Answers

Answer: C

Correct answer: Bounded rationality

Bounded rationality is Simon’s term for the gap between the rational ideal and human capability. The decision maker cannot gather all the information, cannot hold it all in mind, and cannot evaluate every alternative - so rationality operates within bounds set by the person and the situation rather than absolutely.

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: 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.

Answer: A

Correct answer: Expectations

March’s garbage can model identifies four streams flowing independently through an organisation: problems, solutions, participants and choice opportunities. A decision happens when they happen to coincide. Expectations is not among them - and the absence of anything so orderly is the point of the model.

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: D

Correct answer: Heuristics

A heuristic is a rule of thumb that shortens a judgement by substituting an easy question for a hard one. It usually works, which is why it persists, and its failures are systematic rather than random - which is what makes availability, representativeness and anchoring predictable biases rather than mere carelessness.

Answer: A

Correct answer: programmed

The defining features are in the stem: the problem recurs, and the response has already been worked out and is known to whoever must decide. Nothing is left to judgement, so the decision can be delegated, embedded in a procedure, or automated entirely.

Answer: C

Correct answer: top management.

Non-programmed decisions are novel, unstructured and consequential, so they reach the level with the authority and the perspective to take them. The corresponding point is that programmed decisions should be pushed downward - a senior manager spending time on them is spending it on work that a rule could do.

Answer: B

Correct answer: proactive

A proactive decision anticipates the change and acts before it arrives; a reactive one responds after the fact. The distinction is about timing relative to the event rather than about how the decision is reached, so a proactive decision may be intuitive or systematic.

Answer: D

Correct answer: intuitive

Intuition here is not the absence of reasoning but reasoning that has become automatic through experience, so the decision maker reaches a judgement without being able to set out the steps. It is fast and often good in a familiar domain, and unreliable outside one.