Question

While external factors and internal factors often influence decisions on the individual level, the utilization of logic as a decision-making perspective is best defined as:

Pscyhological

Rational

Cognitive

Normative

The concept behind developing a group to define the problem is based upon the fact that if group members cannot agree on the ________ of a problem, they cannot possibly approach a(n) ________.

definition; alternative

nature; solution

evidence; definition

solution; strategy

Starbucks is at constant risk due to the fluctuating prices of coffee beans. They could offset this risk through:

A force majeure

Constantly changing their prices

Setting high prices

A hedge

Answer 1

1) The correct answer is c) Cognitive. This is the right option because cognitive decision-making is defined as the mental process of making a decision by taking into account the surrounding knowledge, analyzing them with judgment and reasoning, and finally converting them into actionable.

2) The correct option is a) definition; alternative. This is the correct option because the first step of Group Problem Solving involves defining the issue or problem in a concise manner before working towards developing a solution. This step is primarily to evaluate or understand the problem at hand without proposing any solutions. Therefore, unless the group members agree on the definition of a problem, they cannot possibly approach an alternative.

3) The correct option is d) A hedge. This is correct because hedging is a great strategy to lock the future prices of commodities. Therefore, using hedging Starbucks can offset the risk of fluctuating prices of coffee beans by locking the price of coffee beans beforehand. This will mitigate the price risk exposure of coffee beans for Starbucks.