When Managers Make Decisions That Are Rational but Limited by Their

question 120

Multiple Choice

When managers make decisions that are rational but limited by their ability to process the information, they are following the concept of ________.

• A) cognitive decision making
• B) bounded rationality
• C) escalation of commitment
• D) intuitive decision making

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Definitions:

Simple Structure

An organizational design characterized by a low degree of departmentalization, wide spans of control, centralized authority, and minimal formalization.

Centralized Organization

A management structure where decision-making authority is concentrated at the top levels of the organization.

Horizontal Decentralization

A management strategy where decision-making authority is distributed across various levels within the organization, often to improve responsiveness and innovation.

Machine Bureaucracy

A highly structured, formal organization model characterized by a clear hierarchy, rigid rules, and a focus on efficiency and predictability.