When managers make decisions that are rational but limited by their ability to process the information, they are exhibiting the concept of ________.
A) cognitive decision-making
B) bounded rationality
C) escalation of commitment
D) intuitive decision-making
E) objective rationality

Question

Quizplus · Accepted Answer

Bounded rationality is the concept that managers are rational in their decision-making but are limited by their ability to process all available information due to time constraints, cognitive limitations, and other factors. This leads to them making decisions that are satisfactory rather than optimal. Option A (cognitive decision-making) refers to the process of decision-making itself, while option C (escalation of commitment) refers to the tendency to persist with a failing course of action. Option D (intuitive decision-making) refers to decisions made based on gut feelings rather than a rational process, and option E (objective rationality) is an idealized concept in which all information is available and a perfect decision is made.

When Managers Make Decisions That Are Rational but Limited by Their