In a short essay, identify and explain the advantages and disadvantages of group decision making
What will be an ideal response?
Answer: Group decisions provide more complete information than do individual ones, as a group will bring a diversity of experiences and perspectives to the decision process that an individual acting alone cannot. In addition, because groups have a greater quantity and diversity of information, they can identify more alternatives than can an individual. Furthermore, group decision making increases acceptance of a solution. Finally, the group decision-making process is consistent with democratic ideals; therefore, decisions made by groups may be perceived as more legitimate than decisions made by a single person.
Group decisions are not without their drawbacks. It takes time to assemble a group, and the interaction that takes place once the group is in place is frequently inefficient. Groups almost always take more time to reach a solution than an individual would take to make the decision alone. Groups may also be subject to minority domination, in which one or a few group members compel others to adhere to their agenda.
Another problem is the pressure to conform in groups. In groupthink, a form of conformity, group members withhold their views in order to avoid controversy, avoid taking responsibility for their actions, and give the appearance of agreement. As a result, groupthink undermines critical thinking in the group and eventually harms the quality of the final decision. And, finally, ambiguous responsibility can become a problem. Group members share responsibility, so the responsibility of any single member is watered down and no one ends up taking "ownership" of the group's final decision.
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Which of the following statements is FALSE?
A) From an accounting perspective, dividends generally reduce the firm's current (or accumulated) retained earnings. B) The way a firm chooses between paying dividends and retaining earnings is referred to as its payout policy. C) Most companies that pay dividends pay them semiannually. D) Occasionally, a firm may pay a one-time, special dividend that is usually much larger than a regular dividend.