When Managers Cannot Assign Probabilities of Future Occurrence to Possible

question 38

Multiple Choice

When managers cannot assign probabilities of future occurrence to possible alternatives with a decision,this is known as:

• A) certainty.
• B) risk.
• C) bounded rationality.
• D) uncertainty.
• E) dialectical inquiry.

---

Definitions:

ATC Curve

Represents the average total cost of production at different levels of output, showing how cost per unit changes with scale.

Excess Capacity

The ability of a company to produce more goods or services than currently needed, exceeding the current demand.

Profit-Maximizing

The act or process of adjusting production and operational strategies to achieve the highest possible profit margins for a business.

ATC Curve

A graphical representation of a firm's average total costs over a range of output levels, typically U-shaped due to economies and diseconomies of scale.