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As a response to a rapidly changing marketplace, Idea Electronics found it necessary to reorganize, including a significant downsize of its middle management. This action will likely result in ___________


A) acquiring additional firms
B) flattening the organization and empowering employees, allowing them to get closer to the customer
C) increasing the size of its traditional departments to handle 24/7 operations
D) centralizing its decision making to better control its total quality management program

E) A) and C)
F) All of the above

Correct Answer

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A(n) __________ is used by an organization to show who is accountable for the completion of specific work and who reports to whom


A) balance sheet
B) Venn diagram
C) stakeholder outline
D) organization chart

E) A) and B)
F) A) and C)

Correct Answer

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Fayol's principles suggest that the goals of the firm are less important than the goals of individual workers.

A) True
B) False

Correct Answer

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Which of the following is considered to be an advantage of functional departmentalization?


A) Employees begin to identify with their department and its goals rather than with the goals of the entire organization.
B) People in the same department tend to think very differently.
C) Departments are isolated from one another.
D) Employee skills can be developed in depth.

E) All of the above
F) A) and D)

Correct Answer

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When management structures the organization, it makes decisions about which products and services it will offer and how it is going to finance the company.

A) True
B) False

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The organizational structure of the U.S. Army's 1st Infantry Division provides for direct two-way lines of responsibility, authority, and communication running from the top to the bottom. Additionally, each person in the division reports to only one superior. The 1st Infantry Division is clearly an example of a(n) :


A) matrix organization.
B) functional organization.
C) line organization.
D) service organization.

E) C) and D)
F) All of the above

Correct Answer

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A flat organizational structure is designed to be more responsive to the needs of management.

A) True
B) False

Correct Answer

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Managers near the top of an organization have the broadest span of control.

A) True
B) False

Correct Answer

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Division of labor is difficult to achieve in small businesses.

A) True
B) False

Correct Answer

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In today's business environment, the trend is to decrease the span of control.

A) True
B) False

Correct Answer

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Departments are functional units within the business such as sales, accounting, finance, and marketing.

A) True
B) False

Correct Answer

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Job descriptions are an important part of Max Weber's organizational theory.

A) True
B) False

Correct Answer

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In firms with centralized authority, each business unit is treated as if it is a completely separate and independent organization.

A) True
B) False

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A line organization in a large business often suffers from excessively slow lines of communication.

A) True
B) False

Correct Answer

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Organizations with positive images for performing exceptional service to customers are usually friendly places to work, as well.

A) True
B) False

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In a line organization, there are many specialists who serve as advisors and assistants to the managers who make decisions.

A) True
B) False

Correct Answer

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In the Making Ethical Decisions box titled "Would You Sacrifice Safety for Profit?" which of the following statements best expresses the theme of the discussion?


A) In the beginning, company procedures that require value judgments are often too costly. As the business grows, the owner can add ethical procedures to each job.
B) The principles of organization state that the only company objective is to gain profits for the owner(s) or stockholders. If your competitors are cutting corners with safety regulations, you should consider the same.
C) The only way to be profitable is to avoid risk. If new safety equipment becomes available that is applicable to your business, even if it slows productivity, you should adopt it.
D) The corporate culture you create as you begin your service will last a long time. Your workers will adopt your values.

E) B) and D)
F) A) and B)

Correct Answer

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Departmentalization by function typically increases the cost of doing business.

A) True
B) False

Correct Answer

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At Green Acres Fencing Company, eight employees perform various aspects of the company's work. One person does sales; four perform installation; one purchases materials; one does billing; one performs after-sales inspections. This type of organization reflects Fayol's principle of:


A) division of labor.
B) equity.
C) unity of command.
D) hierarchy of authority.

E) All of the above
F) B) and D)

Correct Answer

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A bureaucratic style of organization is slow when responding to change.

A) True
B) False

Correct Answer

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