ECONOMICS

Detailed explanation-1: -Explains how managers should make decisions. Assumes managers will make logical decisions that will be optimal in furthering the organization’s best interests. Also called the classical model.

Detailed explanation-2: -The classical model prescribes the best way to make decisions, based on four assumptions: a clearly defined problem, eliminated uncertainty, access to full information, and rational behavior of the decision-maker.

Detailed explanation-3: -Classical decision theory assumes that decisions should be completely rational and optimal; thus, the theory employs an optimizing strategy that seeks the best possible alternative to maximize the achievement of goals.

Detailed explanation-4: -The rational decision-making model describes a series of steps that decision makers should consider if their goal is to maximize the quality of their outcomes. In other words, if you want to make sure you make the best choice, going through the formal steps of the rational decision-making model may make sense.

Detailed explanation-5: -a choice made from among available alternatives. also called the classical model, explains how managers should make decisions; it assumes managers will make logical decisions that will be the optimum in furthering the organization’s best interests. situations that present possibilities for exceeding existing goals.