The Rational Choice Model of Decision Making Is Impossible to Apply

question 120

Multiple Choice

The rational choice model of decision making is impossible to apply in reality because:

• A)it assumes that human beings make decisions based on their emotions.
• B)it ignores the fact that people evaluate their decision after an alternative has been chosen and implemented.
• C)it assumes that people are inefficient and make decisions without rational thought
• D)it ignores the fact that problems must be defined before alternatives are chosen.
• E)it assumes that people are efficient and logical information processing machines.

Identify the differences between leadership and management and the implications for organizational behavior.

Understand the role of personal attributes and skills in effective leadership.

Recognize the importance of ethical leadership and the influence of leaders' decisions on organizational culture and employee behavior.

Understand the key principles of contemporary leadership theories, including Hersey and Blanchard's situational leadership model, Vroom-Jago leader-participation theory, House's path-goal theory, and Fiedler's contingency theory.

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Definitions:

Call Option

An option contract giving the owner the right, albeit without obligation, to purchase a specific asset at a set price within a defined timeframe.

Expiration Date

The date on which a derivative contract such as an option or futures expires, and is no longer valid.

Call Option Value

The price of a call option, which grants the buyer the right, but not the obligation, to purchase an asset at a specified price within a certain time period.

Net Profit

The amount of money left over after all operating expenses, taxes, interest, and dividends are paid, indicating the financial health of a company.