Question 1

If decision makers do not bear the major wealth effects of their decisions,then:

Accepted Answer

A)  the same person in the management structure must hold decision management and control.
B)  separate decision makers must hold decision management and decision control.
C)  decision management is clearly integrated with decision control.
D)  the same managers hold initiation and ratification of decisions.E) A) and B)
F) B) and C)

Question 2

Plain Truth Adverting employs KPR,a large accounting firm,to audit its books each year.This involves considerable expense for the advertising firm,since its sales account managers are very independent and each maintains his separate record-keeping systems.Should the CEO at Plain Truth cancel the audit and rely on a brief year-end summary from each sales account manager? Why or why not?

Accepted Answer

The audit should probably not be cancell...

Question 3

Decision management is made up of:

Accepted Answer

A)  initiation and ratification of projects.
B)  implementation and monitoring of projects.
C)  ratification and monitoring of projects.
D)  initiation and implementation of projects.E) A) and B)
F) B) and C)

Question 4

Jobs have at least two important dimensions that include:

Accepted Answer

A)  variety of tasks and uncertainty.
B)  variety of tasks and decision authority.
C)  uncertainty and decision control.
D)  decision authority and decision control.E) B) and C)
F) C) and D)

Question 5

What are some of the important questions regarding the assignment of decision rights in an organizational hierarchy?

Accepted Answer

Some of the important questions are: Sho...

Question 6

Which of the following is not a benefit of decentralization of corporate decision making?

Accepted Answer

A)  Incentive problems
B)  More effective use of local knowledge
C)  Conservation of the time of senior management
D)  Training and motivation for local managersE) B) and C)
F) A) and D)

Question 7

The issue with centralized versus decentralized decision making is that:

Accepted Answer

A)  centralization is always better because one person controls all information.
B)  it is difficult to find out whether one is better than the other in the hierarchy.
C)  decentralization is always better because many people can split the tasks.
D)  it is always easy to find out which is better,but not all may agree.E) A) and B)
F) B) and C)

Question 8

Which of the following is an example of excessive influencing activities?

Accepted Answer

A)  Informing the manufacturing division of defects in a shipment
B)  Estimating the elasticity of demand for your firm's product
C)  Cancelling a meeting with a client to play golf with your superiors
D)  Taking clients out for dinnerE) A) and B)
F) None of the above

Question 9

What are influence costs,and why do they inhibit efficient organizational design?

Accepted Answer

It is usually better to allow employees ...

Question 10

One of the benefits associated with employee buy-in is that:

Accepted Answer

A)  there are stronger incentives on the part of the employees to implement decisions recommended by themselves.
B)  greater use can be made of specific dispersed knowledge.
C)  employees do not have to take accountability for a decision.
D)  upper-level management can enforce their decisions unilaterally.E) A) and C)
F) C) and D)

Question 11

Kevin Freeman is the head of a team developing plastic knee replacements.His research team has discovered an improved materials -handling procedure that reduces contamination of the product during assembly.The issue for the company after the discovery is:

Accepted Answer

A)  how this specific knowledge can be transferred to the company's whole production process.
B)  whether or not this specific knowledge can be implemented in the knee team's process.
C)  whether to transfer this new knowledge for general corporate use.
D)  to figure out how this discovery can be utilized to reduce influence costs.E) A) and B)
F) All of the above

Question 12

What are some of the demerits of decentralization?

Accepted Answer

Local managers may have incentives to ma...

Question 13

If D represents the level of decentralization of corporate decision making,and A and C are positive constants,then Benefits = B × D and Costs = A × D + C × D2.The optimal level of decentralization occurs where:

Accepted Answer

A)  benefits equal costs.
B)  costs are equal to zero.
C)  D = BD - AD - CD2
D)  D = (B - 
A)  / 2CE) A) and D)
F) B) and C)

Question 14

If D represents the level of decentralization of corporate decision making,and A and C are positive constants,then Benefits = B × D and Costs = A × D + C × D2.The optimal level of decentralization occurs where the:

Accepted Answer

A)  horizontal distance between the benefits and costs curves is greatest.
B)  vertical distance between the benefits and costs curves is greatest.
C)  sum of the squares of the distance between the benefits and costs curves is minimized.
D)  level of benefits is greatest.E) B) and C)
F) All of the above

Question 15

If an employee makes a point of meeting his manager every morning to detail the positive outcomes of the work done the previous day,this is an example of:

Accepted Answer

A)  project initiation.
B)  influence costs.
C)  project monitoring.
D)  decentralization of decision making.E) A) and B)
F) A) and C)

Question 16

Bob is given the right to make all the important decisions in an organization.This is an example of:

Accepted Answer

A)  decentralized decision making.
B)  centralized decision making.
C)  bundling.
D)  a nonstandard practice within a hierarchy.E) B) and D)
F) A) and B)

Question 17

Centralized decision making is most commonly found in:

Accepted Answer

A)  firms that are expanding into other geographical areas.
B)  stable industrial environments.
C)  emerging economies and industries.
D)  highly vertically-integrated firms.E) All of the above
F) C) and D)

Question 18

In addition to other factors,the increased use of technology and the reduced costs of information transfer from local office to corporate headquarters has:

Accepted Answer

A)  significantly increased the need for centralized decision making.
B)  only increased the costs of decentralization.
C)  reduced the need for middle managers and increased the scope of local decision-making authority.
D)  shown that technology has little impact on the centralization issue.E) None of the above
F) A) and B)

Question 19

In his seminar on Organizational Economics,Professor Chang always uses study teams for presentation of outside research materials.He has found that three students per team tend to work well.Walking into a new class,he finds that registration has allowed 60 students to sign up.He decides to increase the team size from 3 to 8 students.What problems can he expect to deal with during the semester?

Accepted Answer

Chang is likely to hear more student com...

Question 20

We say that a firm is vertically integrated if:

Accepted Answer

A)  it develops differentiated products that command price premiums.
B)  it makes some of its own inputs.
C)  it centralizes all its output decisions but decentralizes its pricing decisions.
D)  it decentralizes all its input purchases but centralizes its decisions on output.E) C) and D)
F) B) and C)

Exam 12: Decision Rights: the Level of Empowerment

What are influence costs,and why do they inhibit efficient organizational design?

Correct Answer
verified
It is usually better to allow employees ...
View Answer

If D represents the level of decentralization of corporate decision making,and A and C are positive constants,then Benefits = B × D and Costs = A × D + C × D².The optimal level of decentralization occurs where the:

Correct Answer
verified

Bob is given the right to make all the important decisions in an organization.This is an example of:

Correct Answer
verified

Which of the following is an example of excessive influencing activities?

Correct Answer
verified

If decision makers do not bear the major wealth effects of their decisions,then:

Correct Answer
verified

The issue with centralized versus decentralized decision making is that:

Correct Answer
verified

We say that a firm is vertically integrated if:

Correct Answer
verified

Correct Answer
verified
The audit should probably not be cancell...
View Answer

In addition to other factors,the increased use of technology and the reduced costs of information transfer from local office to corporate headquarters has:

Correct Answer
verified

What are some of the demerits of decentralization?

Correct Answer
verified
Local managers may have incentives to ma...
View Answer

If an employee makes a point of meeting his manager every morning to detail the positive outcomes of the work done the previous day,this is an example of:

Correct Answer
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Jobs have at least two important dimensions that include:

Correct Answer
verified

Centralized decision making is most commonly found in:

Correct Answer
verified

Correct Answer
verified
Chang is likely to hear more student com...
View Answer

What are some of the important questions regarding the assignment of decision rights in an organizational hierarchy?

Correct Answer
verified
Some of the important questions are: Sho...
View Answer

Decision management is made up of:

Correct Answer
verified

If D represents the level of decentralization of corporate decision making,and A and C are positive constants,then Benefits = B × D and Costs = A × D + C × D².The optimal level of decentralization occurs where:

Correct Answer
verified

Kevin Freeman is the head of a team developing plastic knee replacements.His research team has discovered an improved materials -handling procedure that reduces contamination of the product during assembly.The issue for the company after the discovery is:

Correct Answer
verified

Which of the following is not a benefit of decentralization of corporate decision making?

Correct Answer
verified

One of the benefits associated with employee buy-in is that:

Correct Answer
verified

Exam 12: Decision Rights: the Level of Empowerment

What are influence costs,and why do they inhibit efficient organizational design?

Correct AnswerverifiedIt is usually better to allow employees ...View AnswerShow Answer

If D represents the level of decentralization of corporate decision making,and A and C are positive constants,then Benefits = B × D and Costs = A × D + C × D2.The optimal level of decentralization occurs where the:

Correct AnswerverifiedShow Answer

Bob is given the right to make all the important decisions in an organization.This is an example of:

Correct AnswerverifiedShow Answer

Which of the following is an example of excessive influencing activities?

Correct AnswerverifiedShow Answer

If decision makers do not bear the major wealth effects of their decisions,then:

Correct AnswerverifiedShow Answer

The issue with centralized versus decentralized decision making is that:

Correct AnswerverifiedShow Answer

We say that a firm is vertically integrated if:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedThe audit should probably not be cancell...View AnswerShow Answer

In addition to other factors,the increased use of technology and the reduced costs of information transfer from local office to corporate headquarters has:

Correct AnswerverifiedShow Answer

What are some of the demerits of decentralization?

Correct AnswerverifiedLocal managers may have incentives to ma...View AnswerShow Answer

If an employee makes a point of meeting his manager every morning to detail the positive outcomes of the work done the previous day,this is an example of:

Correct AnswerverifiedShow Answer

Jobs have at least two important dimensions that include:

Correct AnswerverifiedShow Answer

Centralized decision making is most commonly found in:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedChang is likely to hear more student com...View AnswerShow Answer

What are some of the important questions regarding the assignment of decision rights in an organizational hierarchy?

Correct AnswerverifiedSome of the important questions are: Sho...View AnswerShow Answer

Decision management is made up of:

Correct AnswerverifiedShow Answer

If D represents the level of decentralization of corporate decision making,and A and C are positive constants,then Benefits = B × D and Costs = A × D + C × D2.The optimal level of decentralization occurs where:

Correct AnswerverifiedShow Answer

Kevin Freeman is the head of a team developing plastic knee replacements.His research team has discovered an improved materials -handling procedure that reduces contamination of the product during assembly.The issue for the company after the discovery is:

Correct AnswerverifiedShow Answer

Which of the following is not a benefit of decentralization of corporate decision making?

Correct AnswerverifiedShow Answer

One of the benefits associated with employee buy-in is that:

Correct AnswerverifiedShow Answer

Correct Answer
verified
It is usually better to allow employees ...
View Answer

If D represents the level of decentralization of corporate decision making,and A and C are positive constants,then Benefits = B × D and Costs = A × D + C × D².The optimal level of decentralization occurs where the:

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The audit should probably not be cancell...
View Answer

Correct Answer
verified

Correct Answer
verified
Local managers may have incentives to ma...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Chang is likely to hear more student com...
View Answer

Correct Answer
verified
Some of the important questions are: Sho...
View Answer

Correct Answer
verified

If D represents the level of decentralization of corporate decision making,and A and C are positive constants,then Benefits = B × D and Costs = A × D + C × D².The optimal level of decentralization occurs where:

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified