When Managers Base Decisions on What Has Worked in the Past

question 73

Multiple Choice

When managers base decisions on what has worked in the past and fail to explore new options, they are:

• A) perpetuating the status quo.
• B) being influenced by emotions.
• C) being overconfident.
• D) justifying past actions.
• E) seeing what they want to see.

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Definitions:

Command Economy

An economic system where the government controls all major aspects of production, investment, and distribution.

Laissez-Faire

An economic theory from the 18th century that is strongly against the government interfering in the marketplace.

Invisible-Hand

A term coined by Adam Smith to describe the self-regulating nature of the marketplace, where individual self-interest inadvertently benefits society at large.

Command Economy

An economic system where the government or central authority makes all decisions regarding the production and distribution of goods and services.