4/12/26, 1:22 PM Managerial Decision Making Final
Managerial Decision Making Final Exam 2026-2027 ||Most
Recent Exam Actual Complete Real Exam Questions And Correct
Answers (Verified Answers) Already Graded A+ |Guaranteed
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bounded rationality
rationality that falls short of omniscience
2 types of people with rationality
1. econs
2. humans
econs
perfect knowledge of alternatives and consequences, consistent
preferences and decision rules, and pay attention to feedback; normative
humans
limited knowledge of alternatives and consequences, inconsistent
preferences and decision rules, and pay limited attention to feedback;
descriptive
/ 1/24
,4/12/26, 1:22 PM Managerial Decision Making Final
why is limited rationality important for managers?
"the work of managers...the work that steers the course of society and its
economic and governmental organizations...is largely the work of making
decisions and solving problems"
prescriptive managerial decision making
a framework that instructs managers on how they should make decisions
to achieve an optimal outcome, rather than merely describing how
decisions are actually made
cognitive biases
systematic deviations from rationality
cognitive heuristics
rules of thumb and intuition
satisficer
chooses quickly, trusts their gut, looks for "good enough" ; experiences
less regret, savors positive outcomes more greatly, enjoys higher job
satisfaction
maximizer
chooses slowly, trusts their analysis, looks for "the best" ; engages in more
comparisons, gets better deals, earns higher salaries
/ 2/24
, 4/12/26, 1:22 PM Managerial Decision Making Final
system 1
automatic processing that's effortless and fast; saves time, usually works well
system 2
deliberate processing that's effortful and slow; correct any failures
- "system 2 is mobilized when a novel question arises for which system 1
doesn't have an answer"
- "system 2 is mobilized to increased effort when it detects a surprise/error"
- "system 2 defaults to low-effort mode"
risk perception
same analysis, different interpretation ; an individual's subjective
assessment of the severity and likelihood of a potential loss, influenced
by experience and cognitive biases
risk propensity
same interpretation, different decision ; an individual's general tendency to
take or avoid risks, acting as a trait that influences decision-making
effective decision making requires...
asking the right question, not just getting the right answers
/ 3/24
Managerial Decision Making Final Exam 2026-2027 ||Most
Recent Exam Actual Complete Real Exam Questions And Correct
Answers (Verified Answers) Already Graded A+ |Guaranteed
Success!! Newest Exam | Just Released!!
bounded rationality
rationality that falls short of omniscience
2 types of people with rationality
1. econs
2. humans
econs
perfect knowledge of alternatives and consequences, consistent
preferences and decision rules, and pay attention to feedback; normative
humans
limited knowledge of alternatives and consequences, inconsistent
preferences and decision rules, and pay limited attention to feedback;
descriptive
/ 1/24
,4/12/26, 1:22 PM Managerial Decision Making Final
why is limited rationality important for managers?
"the work of managers...the work that steers the course of society and its
economic and governmental organizations...is largely the work of making
decisions and solving problems"
prescriptive managerial decision making
a framework that instructs managers on how they should make decisions
to achieve an optimal outcome, rather than merely describing how
decisions are actually made
cognitive biases
systematic deviations from rationality
cognitive heuristics
rules of thumb and intuition
satisficer
chooses quickly, trusts their gut, looks for "good enough" ; experiences
less regret, savors positive outcomes more greatly, enjoys higher job
satisfaction
maximizer
chooses slowly, trusts their analysis, looks for "the best" ; engages in more
comparisons, gets better deals, earns higher salaries
/ 2/24
, 4/12/26, 1:22 PM Managerial Decision Making Final
system 1
automatic processing that's effortless and fast; saves time, usually works well
system 2
deliberate processing that's effortful and slow; correct any failures
- "system 2 is mobilized when a novel question arises for which system 1
doesn't have an answer"
- "system 2 is mobilized to increased effort when it detects a surprise/error"
- "system 2 defaults to low-effort mode"
risk perception
same analysis, different interpretation ; an individual's subjective
assessment of the severity and likelihood of a potential loss, influenced
by experience and cognitive biases
risk propensity
same interpretation, different decision ; an individual's general tendency to
take or avoid risks, acting as a trait that influences decision-making
effective decision making requires...
asking the right question, not just getting the right answers
/ 3/24
