Texas BUS300 exam 2

Question 1

1. Decision makers who "cherry-pick" information that matches what they already know are guilty of confirmation bias.

   True

   False

2 points

Question 2

1. Which of the following is the most effective number of people to have in a group?

   		5-7
   		2-4
   		10-15
   		16-25

2 points

Question 3

1. In forward vertical integration, a company becomes its own ________, while in backward vertical integration, the company is its own ________.

   		supplier; distributor
   		supplier; customer
   		distributor; monitor
   		distributor; supplier

2 points

Question 4

1. A sneaker company creating its own stores where it sells only its own brand is an example of which of the following?

   		forward vertical integration
   		backward horizontal integration
   		forward horizontal integration
   		reverse vertical integration

2 points

Question 5

1. Which of the following is a frequently cited criticism of formal planning?

   		Plans lock organizations into rigid goals and timetables.
   		Plans take too long to create.
   		Plans create resentment within different levels of the organization.
   		Formal planning works well only for smaller companies.

2 points

Question 6

1. Functional departmentalization groups jobs by ________.

   		tasks they perform
   		territories they serve
   		products or services they manufacture or produce
   		type of customer they serve

2 points

Question 7

1. Which of the following is used exclusively to generate creative ideas in a group setting?

   		brainstorming
   		nominal group technique
   		groupthink
   		electronic meetings

2 points

Question 8

1. When a top manager decides to hire an individual over the objections of her staff, she is exercising which kind of power?

   		referent
   		expert
   		coercive
   		legitimate

2 points

Question 9

1. Groups decisions are usually ________ individual decisions.

   		more efficient than
   		less efficient than
   		equal in efficiency to
   		more efficient but less effective than

2 points

Question 10

1. In the chain of command, each person above you ________.

   		has special privileges
   		receives higher pay
   		has line authority
   		has no right to give you orders

2 points

Question 11

1. Emotions and feelings ________ decision making.

   		have no effect on
   		can improve
   		decrease performance in
   		are more important than facts and logic in

2 points

Question 12

1. Liquidity is a measure of an organization's ability to access cash to meet its debt obligations.

   True

   False

2 points

Question 13

1. When dealing with international organizations, managers must be ________ in order to accommodate the managing styles of different cultures.

   		as flexible as possible
   		as inflexible as possible
   		as strict as possible
   		as thorough

2 points

Question 14

1. A bank manager who passes out bonuses at the end of the year is exercising this.

   		reward power
   		coercive power
   		expert power
   		referent power

2 points

Question 15

1. A scientist cites two studies that show a positive effect for her drug and ignores five other studies that show a negative effect. Which error or bias is she committing?

   		hindsight
   		anchoring effect
   		confirmation bias
   		self-serving

2 points

Question 16

1. The chain of command answers this question.

   		Where do I go for help?
   		How do I know when the task is complete?
   		What are the rules?
   		Who reports to whom?

2 points

Question 17

1. Decisions, Decisions (Scenario)
   
   Sondra needed help. Her insurance company's rapid growth was necessitating making some IT changes, but what changes? Should they modify the servers that they currently used or purchase an entirely new system? Sondra was confused and needed help in making the correct decision.
   
   
   Sondra has decided to purchase a new system. After obtaining permission, she has ordered the system from a reputable company. Which stage of the decision-making process is she carrying out in making the order?

   		analyzing alternative solutions
   		selecting an alternative
   		implementing the alternative
   		identifying the problem

2 points

Question 18

1. In a decision tree, which of the following is true?

   		The probabilities of all of the outcomes must be equal.
   		The sum of the probabilities of all of the outcomes must equal 1.0.
   		No outcome can have a probability that is less to 1.0.
   		The sum of the probabilities of all of the outcomes must be greater than 1.0.

2 points

Question 19

1. The decision tree shows the profit outcomes for a sandwich shop in a strong and a weak economy. If the economy is strong, the shop is likely to make an $80,000 profit.
   
   

   True

   False

2 points

Question 20

1. A manager has a choice of three bank CDs that pay different amounts of interest over different time periods. The manager is operating under which condition?

   		jeopardy
   		certainty
   		uncertainty
   		risk

2 points

Question 21

1. A manager can faithfully execute the decision-making process but still end up with nothing of value if ________.

   		he fails to identify the correct problem
   		he fails to assign number values to different criteria
   		he solves the problem inefficiently
   		he fails to correctly identify the steps of the process

2 points

Question 22

1. In informal planning, goals are usually ________ shared with others in the organization.

   		written, but little is
   		unwritten and little is
   		written and much is
   		unwritten, but much is

2 points

Question 23

1. Which of the following is synonymous with work specialization?

   		division of labor
   		job discrimination
   		chain of command
   		job preference

2 points

Question 24

1. Most managerial decisions include an element of risk.

   True

   False

2 points

Question 25

1. The decision tree shows the profit outcomes for a coffee shop in a strong and a weak economy for next year. What is the probability that the economy will be weak in the coming year?
   
   

   		0.73
   		27 percent
   		50 percent
   		7.3

2 points

Question 26

1. A soap company that features a bath soap department, a laundry detergent department, and a dish soap department is using which of the following?

   		process departmentalization
   		functional departmentalization
   		product departmentalization
   		customer departmentalization

2 points

Question 27

1. Taco Rocket (Scenario)
   
   Imagine that you are the president of Taco Rocket, a new and successful chain of 8 Mexican fast-food restaurants. The success you have experienced in the last 5 years has you thinking of what to do with the business next. Should you expand the business at the current rate? Open new and different restaurants? What?
   
   
   For a limited time, Taco Rocket is thinking of coming out with a new Fifth Degree Burrito that is so hot it "burns a hole in the plate." Catering to the small segment of the market that likes super-hot food is an example of a ________.

   		focus strategy
   		cost leader strategy
   		long-term strategy
   		differentiation strategy

2 points (Extra Credit)

Question 28

1. Group decisions tend to provide more complete information than individual decisions.

   True

   False

2 points

Question 29

1. Which three conditions do decision makers face?

   		certainty, risk, uncertainty
   		certainty, uncertainty, confidence
   		risk, high risk, low risk
   		certainty, risk, high risk

2 points

Question 30

1. Which of the following is an example of a strategic goal for a professional baseball team?

   		to increase attendance by 5 percent over the next three years
   		to increase television revenues over the next 5 years
   		to decrease payroll by 20 million over the next 2 years
   		to average over 90 wins a year for the next 5 years

2 points

Question 31

1. An internal analysis, the third step of the strategic management process helps identify ________.

   		opportunities and threats
   		resources and capabilities
   		opportunities and possibilities
   		values and philosophy

2 points

Question 32

1. Sticking to a decision despite evidence that it is a mistake is called ________.

   		escalation of commitment
   		escalation of rationality
   		satisficing commitment
   		error enhancement

2 points

Question 33

1. The first step in the six-step strategic management process is to ________.

   		analyze the organization's strengths and weaknesses
   		identify the organization's mission
   		identify strategies to reach the organization's goals
   		analyze the opportunities the organization has

2 points

Question 34

1. Line authority gives a manager the ability to direct the work of ________.

   		any employee in the firm
   		any subordinate
   		any subordinate, after consulting with the next higher level
   		only subordinates one level down

2 points

Question 35

1. Which of the following is NOT allowed in a brainstorming session?

   		clear definition of the problem
   		criticism or dismissal of poor ideas
   		large number of alternatives
   		recording of all alternatives

2 points

Question 36

1. Which statement accurately defines work specialization?

   		It is the degree to which tasks are grouped together.
   		Individual employees specialize in doing part of an activity rather than the entire activity.
   		Jobs are ranked relative only to their worth or value to the businesses.
   		Work specialization clarifies who reports to whom.

2 points

Question 37

1. The personal secretary of a top manager may have ________.

   		power but not authority
   		authority but not power
   		power and authority
   		line authority but not staff authority

2 points

Question 38

1. One legislator sees decreased tax revenue as the key problem in the budget. A second legislator sees increased spending as the problem. Each of these legislators has a(n) ________.

   		representation bias
   		self-serving bias
   		availability bias
   		framing bias

2 points

Question 39

1. In a condition of certainty, ________.

   		most outcomes are known
   		the decision is already made
   		all outcomes of all alternatives are known
   		some alternatives are not known

2 points

Question 40

1. In decision making, a problem can be defined as a discrepancy between what exists and what the problem solver desires to exist.

   True

   False

2 points

Question 41

1. Individualistic countries like the United States tend to have ________ than group-oriented countries like Japan.

   		more conformity and more cooperation
   		more conformity and less cooperation
   		less conformity and more cooperation
   		less conformity and less cooperation

2 points

Question 42

1. Decisions, Decisions (Scenario)
   
   Sondra needed help. Her insurance company's rapid growth was necessitating making some IT changes, but what changes? Should they modify the servers that they currently used or purchase an entirely new system? Sondra was confused and needed help in making the correct decision.
   
   
   According to the decision-making process, the first step Sondra should take is to ________.

   		analyze alternative solutions
   		identify decision criteria
   		evaluate her decision's effectiveness
   		identify the problem

2 points

Question 43

1. SWOT analysis identifies and analyzes an organization's ________.

   		strengths, weaknesses, opportunities, and threats
   		strategy for competing in the market
   		human resource assets
   		long-term goals

2 points

Question 44

1. Which of the following is NOT a function of planning?

   		defining goals
   		identifying a strategy for attaining goals
   		settling disputes between employees
   		coordinating organizational activities

2 points

Question 45

1. A manager is determining what kind of new computers she should purchase for her department. She has made a list of five different computer models for consideration. Which stage of the decision-making process is this?

   		selection of an alternative
   		identification of decision criteria
   		development of alternatives
   		analysis of alternatives

2 points

Question 46

1. Taco Rocket (Scenario)
   
   Imagine that you are the president of Taco Rocket, a new and successful chain of 8 Mexican fast-food restaurants. The success you have experienced in the last 5 years has you thinking of what to do with the business next. Should you expand the business at the current rate? Open new and different restaurants? What?
   
   
   Recently, Taco Rocket has considered buying a local competitor and the two would combine under the Taco Rocket name. This is an example of which of the following?

   		stability
   		vertical integration
   		horizontal integration
   		diversification

2 points

Question 47

1. State motor vehicle offices usually use this kind of departmentalization.

   		product
   		functional
   		customer
   		process

2 points

Question 48

1. A manager uses break-even analysis to find out how many units of a product he needs to sell to make a profit of zero.

   True

   False

2 points

Question 49

1. An external analysis, the second step of the strategic management process, helps identify ________.

   		the products that a company makes
   		the long-term goals of a company
   		a company's opportunities and threats
   		a company's concern for its employees

2 points

Question 50

1. A person who satisfices fails to ________.

   		maximize his or her decision
   		understand his or her position
   		accept the truth of a situation
   		make any kind of decision

2 points

Question 51

1. Taco Rocket (Scenario)
   
   Imagine that you are the president of Taco Rocket, a new and successful chain of 8 Mexican fast-food restaurants. The success you have experienced in the last 5 years has you thinking of what to do with the business next. Should you expand the business at the current rate? Open new and different restaurants? What?
   
   
   You are thinking of buying a tortilla factory in a nearby state. This action would be an example of ________.

   		forward vertical integration
   		horizontal integration
   		backward vertical integration
   		forward diversification