Business Decision-Making: Types,
Criteria, and Financial Analysis Exam
2026 Questions and Answers Graded A+
What are the three types of business decisions? - Correct answer-Strategic,
Tactical, and Operational decisions.
What is a strategic decision in a business context? - Correct answer-A decision that
involves long-term planning, such as whether to open new sportswear shops.
What is a tactical decision? - Correct answer-A decision that focuses on how to
implement a strategy, such as which skiwear to stock.
What does an operational decision entail? - Correct answer-Day-to-day decisions,
such as where to display skiwear in a shop.
What does it mean for a business to be risk-averse? - Correct answer-It means the
business is reluctant to take risks, preferring safer options.
What is Ansoff's Matrix used for? - Correct answer-It is a tool to measure risk in
business decisions.
©COPYRIGHT 2026, ALL RIGHTS RESERVED 1
,How can a business's objectives influence its decisions? - Correct answer-
Objectives like reducing costs can limit decisions such as hiring more staff.
What are core competencies in a business? - Correct answer-Unique strengths that
allow a business to stand out from competitors.
Give an example of a company's core competence. - Correct answer-Facebook's
core competence is social networking.
How do business ethics affect decision-making? - Correct answer-Businesses may
choose ethical practices even if they are more costly.
What is opportunity cost? - Correct answer-The loss of potential gain from other
alternatives when one alternative is chosen.
What internal factor might affect a business's decision to automate? - Correct
answer-The potential impact on employee job losses.
What external factors can influence business decisions? - Correct answer-Natural
disasters, changes in consumer trends, and economic factors.
What should businesses assess before making major strategic decisions? - Correct
answer-The likelihood of risks and their potential impacts.
©COPYRIGHT 2026, ALL RIGHTS RESERVED 2
, What is the impact of financial considerations on business decisions? - Correct
answer-Decisions often depend on available funds, affecting choices like buying or
renting premises.
How does time affect business decision-making? - Correct answer-Complex
decisions require more time to consider than simple ones.
What is the degree of uncertainty in business decisions? - Correct answer-It refers
to the unpredictability of risks and their likelihood of occurrence.
What is a potential consequence of a business decision on external stakeholders? -
Correct answer-Decisions can impact customers, local communities, and pressure
groups.
Why might a business choose to use outside contractors? - Correct answer-To
avoid capital investments and running costs associated with in-house tasks.
What role do consumer trends play in business ethics? - Correct answer-They
dictate that businesses adopt ethical practices to meet customer expectations.
What is the significance of assessing market changes? - Correct answer-Businesses
need to respond quickly to maintain or gain market share.
What is the importance of a business's attitude to risk? - Correct answer-It
influences how they approach decision-making and long-term survival.
©COPYRIGHT 2026, ALL RIGHTS RESERVED 3
Criteria, and Financial Analysis Exam
2026 Questions and Answers Graded A+
What are the three types of business decisions? - Correct answer-Strategic,
Tactical, and Operational decisions.
What is a strategic decision in a business context? - Correct answer-A decision that
involves long-term planning, such as whether to open new sportswear shops.
What is a tactical decision? - Correct answer-A decision that focuses on how to
implement a strategy, such as which skiwear to stock.
What does an operational decision entail? - Correct answer-Day-to-day decisions,
such as where to display skiwear in a shop.
What does it mean for a business to be risk-averse? - Correct answer-It means the
business is reluctant to take risks, preferring safer options.
What is Ansoff's Matrix used for? - Correct answer-It is a tool to measure risk in
business decisions.
©COPYRIGHT 2026, ALL RIGHTS RESERVED 1
,How can a business's objectives influence its decisions? - Correct answer-
Objectives like reducing costs can limit decisions such as hiring more staff.
What are core competencies in a business? - Correct answer-Unique strengths that
allow a business to stand out from competitors.
Give an example of a company's core competence. - Correct answer-Facebook's
core competence is social networking.
How do business ethics affect decision-making? - Correct answer-Businesses may
choose ethical practices even if they are more costly.
What is opportunity cost? - Correct answer-The loss of potential gain from other
alternatives when one alternative is chosen.
What internal factor might affect a business's decision to automate? - Correct
answer-The potential impact on employee job losses.
What external factors can influence business decisions? - Correct answer-Natural
disasters, changes in consumer trends, and economic factors.
What should businesses assess before making major strategic decisions? - Correct
answer-The likelihood of risks and their potential impacts.
©COPYRIGHT 2026, ALL RIGHTS RESERVED 2
, What is the impact of financial considerations on business decisions? - Correct
answer-Decisions often depend on available funds, affecting choices like buying or
renting premises.
How does time affect business decision-making? - Correct answer-Complex
decisions require more time to consider than simple ones.
What is the degree of uncertainty in business decisions? - Correct answer-It refers
to the unpredictability of risks and their likelihood of occurrence.
What is a potential consequence of a business decision on external stakeholders? -
Correct answer-Decisions can impact customers, local communities, and pressure
groups.
Why might a business choose to use outside contractors? - Correct answer-To
avoid capital investments and running costs associated with in-house tasks.
What role do consumer trends play in business ethics? - Correct answer-They
dictate that businesses adopt ethical practices to meet customer expectations.
What is the significance of assessing market changes? - Correct answer-Businesses
need to respond quickly to maintain or gain market share.
What is the importance of a business's attitude to risk? - Correct answer-It
influences how they approach decision-making and long-term survival.
©COPYRIGHT 2026, ALL RIGHTS RESERVED 3
