Decision Making

Question 1

Rational Decision

Answer 1

Refers to choices that are consistent and value-maximizing within specified constraints.

Question 2

Bounded Rationality

Answer 2

Limitations on one’s ability to interpret, process and act on information.

Question 3

Satisficing

Answer 3

To provide a solution that is both satisfactory and sufficient. It is also the identification of a good enough solution or the first acceptable solution rather than the optimal one.

Question 4

Intuition or intuitive decision making

Answer 4

An unconscious process created out of a person’s many experiences

Question 5

Overconfidence Bias

Answer 5

An error in jugement that arises from being far too optimistic about one’s own performance.

Question 6

Anchoring Bias

Answer 6

A tendency to fixate on initial information from which one then fails to adequately adjust for subsequent information.

Question 7

Confirmation bias

Answer 7

The tendency to seek out information that reaffirms past choices and to discount information that contradicts past judgements.

Question 8

Availability bias

Answer 8

The tendency for people to base their judgements on information that is readily available to them rather than complete data.

Question 9

Escalation of commitment

Answer 9

An increased commitment to a previous decision despite negative information.

Question 10

Randomness error

Answer 10

The tendency for individuals to believe that they can predict the outcome of random events

Question 11

Risk aversion

Answer 11

The tendency to prefer a sure gain of a moderate amount of risk over a riskier outcome, even if the riskier outcome might have a higher expected payoff.

Question 12

Hindsight bias

Answer 12

The tendency to believe falsely, after an outcome of an event is actually known, that one could have accurately predicted that outcome.

Question 13

Groupthink

Answer 13

A phenomenon in which group pressures for conformity prevent the group from critically appraising unusual, minority, or unpopular views.

Question 14

Group shift

Answer 14

A phenomenon in which the initial positions of individual group members become exaggerated because of the interactions of the group.

Question 15

Three-stage model of creativity

Answer 15

The proposition that creativity involves three stages : causes (creative potential and creative environement), creative behaviour, and creative outcomes
(innovation–> novelty and usefulness)

Question 16

Innovation

Answer 16

Innovation brings about the novelty and the usefulness of a creative outcome.

Question 17

Ethics

Answer 17

The study of moral values or principles that guide our behaviour and inform us wether actions are right or wrong.

Question 18

Utilitarian criterion

Answer 18

A decision focused on outcomes or consequences that emphasizes the greatest good for the greatest number

Question 19

Rights criterion

Answer 19

Any action against fundamental rights is not good.

Question 20

Justice criterion

Answer 20

Any action against the law is not good. People in organizations are mainly focused with that criterion.

Question 21

Care criterion

Answer 21

In a group people care for one another and have interpersonal relationships, which should be preserved at all costs. It is important for this criterion that people understand the value of a group.

Question 22

Corporate social responsibility

Answer 22

An organization’s responsibility to consider the impact of its decisions on society.