The Benefits of a Simple Structure Include All of the Following

question 72

Multiple Choice

The benefits of a simple structure include all of the following EXCEPT:

• A) ease of coordination within the organization.
• B) the lack of a need for sophisticated information systems.
• C) active involvement by the owner-manager.
• D) the ability of specialists to develop deep expertise.

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Definitions:

Combined Return On Investment

A measure assessing the total financial return of different investments or the aggregate performance of an entire investment portfolio.

Contribution Margin Ratio

A financial metric that shows the percentage of sales revenue that exceeds variable costs, contributing to covering fixed costs and generating profit.

Residual Income

The net income that exceeds the minimum required return on investment or capital; often used as a performance measure in managerial accounting.

Investment Opportunity

An option to allocate resources with the expectation of generating a return or profit in the future.