Managers who use the method of optimizing to make their decisions will attempt to choose:

• A. the option that is most popular among employees
• B. the option that yields the highest net benefit
• C. the option that avoids any form of risk
• D. the option that requires the least amount of effort

Answer: (B)

Verified step by step guidance

1. Understand the concept of optimization in managerial decision-making, which involves selecting the option that maximizes the net benefit or overall value to the firm or decision-maker.
2. Recognize that net benefit is calculated as the total benefits minus the total costs associated with each option.
3. Identify that the method of optimizing does not focus on popularity, risk avoidance, or effort minimization alone, but rather on the option that provides the greatest positive difference between benefits and costs.
4. Formulate the decision rule: choose the option for which \(\text{Net Benefit} = \text{Total Benefits} - \text{Total Costs}\) is the highest among all alternatives.
5. Apply this rule by comparing the net benefits of all available options and selecting the one with the maximum net benefit.