Which decision-making model assumes managers act completely rationally, have full information, and evaluate all possible alternatives objectively?
ABounded Rationality Model
BRational Decision-Making Model
CAdministrative Model
DIntuitive Decision Model
Explanation
• The Rational Decision-Making Model assumes complete information, objective problem definition, known preferences, and optimal decision outcomes.
• Herbert Simon challenged this with ‘Bounded Rationality’, stating cognitive limits cause managers to ‘satisfice’ rather than optimize.
• Satisficing means selecting the first solution that meets minimum acceptable criteria.
Exam Relevance
- Topic: Decision Making
- Subtopic: Decision Making Models

No Comments