Generally, the decision maker makes decision under the condition of
certainty, risk and uncertainty
. There are three conditions that managers may face as they make decisions. They are (1) Certainty, (2) Risk, and (3) Uncertainty.
What is an occurrence or a situation over which the decision maker has little or no control?
State of Nature
. An occurrence or a situation over which the decision maker has little or no control.
Which type of environments exists when managers have so little information that they Cannot even assign probabilities to various alternatives and their possible outcomes?
Uncertainty
. When information is so poor that managers can’t even assign probabilities to the likely outcomes of alternatives, the manager is making a decision in an uncertain environment. This condition is the most difficult for a manager.
When managers Cannot assign probabilities of future occurrence to possible alternatives with a decision this is known as?
When managers cannot assign probabilities of future occurrence to possible alternatives to a decision, this is known as:
uncertainty
.
Which model views decision makers as acting in a world of complete certainty?
(1999:18) considered that “
classical decision theory
views the decision maker as acting in a world of complete certainty.” It assumes that “decision makers are objective, have complete information and consider all possible alternatives and their consequences before selecting the optimal solution.” (Huczynski 2001:738) …
What are the three general conditions under decision-making?
Managers make problem‐solving decisions under three different conditions:
certainty, risk, and uncertainty
. All managers make decisions under each condition, but risk and uncertainty are common to the more complex and unstructured problems faced by top managers.
What is certainty conditions?
A condition of certainty exists
when the decision-maker knows with reasonable certainty what the alternatives are
, what conditions are associated with each alternative, and the outcome of each alternative. … The cause and effect relationships are known and the future is highly predictable under conditions of certainty.
Which of the following is the 5th step in the decision making process?
5. Select the best decision. After all of the examination, contemplating, and even taking notes, the fifth step in the decision making process in management is
to actually make the final selection
.
How do you use decision making and problem solving?
- Identify the problem.
- Search for alternatives.
- Weigh the alternatives.
- Make a choice.
- Implement the choice.
- Evaluate the results and, if necessary, start the process again.
What is EVPI how it is calculated?
EVPI is calculated as
the difference in the monetary value of health gain associated with a decision between therapy alternatives between when the choice is made on the basis
of with currently available information (i.e. uncertainty in the factors of interest) and when the choice is made based on perfect information ( …
Which of the following is an example of an operational decision?
An operational decision might be
the printing and distributing of discount coupons or the construction of a play area for children
. Operational decisions are about the details of work that needs to be done to meet your strategic plan’s goals and implementing those details.
What is the first step in the decision-making process and why is it important?
The first step in good decision making involves
defining what question or problem is being addressed and why
, identifying who needs to be involved and how, establishing scope and bounds for the decision, and clarifying the roles and responsibilities of the decision team.
Which of the following is most likely to be a disadvantage of brainstorming in an organization?
Which of the following is most likely to be a disadvantage of brainstorming in an organization?
Group members cannot always simultaneously understand the alternatives and think up additional alternatives
.
What are simplifying strategies or rules of thumb?
(
Heuristics
) are strategies such as “rules of thumb” that simplify decision making.
What is the first step in the rational decision model?
The first step to make a rational decision is
to identify and describe the problem by defining the current and desired states and defining the alternatives
: Keep in mind during identifying the problem to identify the cause of the problem, not the symptoms. Define the gap between the current state and the desired state.
Which type of decision theory model accepts the notion of bounded rationality and suggest that people act only in terms of what they perceive about a given situation?
True or false:
Classical decision theory models
accept the notion of bounded rationality and suggest that people act only in terms of what they perceive about a given situation. … uncertain environments provide little, if any, information to predict expected results for decision-making alternatives.
