MGT 3200 : MGT3200 Exam2
Document Summary
Exam two objectives (from the notes & outside reading) Decision-making is a key activity at all levels of management. Managers also must make decisions related to all functions of management not only to the planning function. When a decision is made under conditions of certainty the managers knows all the available alternatives and the outcomes associated with each. In this case, the manager has perfect knowledge about all alternatives and their outcomes. There is no element of chance that intervenes between the alternative and its income. The outcomes of alternatives are known with 100% probability absolute certainty. Certainty is an ideal situation for managerial decision-making. Under certainty, a manager simply picks the alternative with the best outcome. Managerial decisions are seldom made under conditions of certainty. This condition involves a lack of complete certainty regarding the outcomes of various alternatives, but an awareness of the probabilities associated with their occurrence. Thus, alternatives are known but outcomes are in doubt.
