Application of Qualities of Effective Control Systems

question 111

Multiple Choice

Application of Qualities of Effective Control Systems
Jared has been hired to establish a control system for SRP Inc. Jared knows several decisions must be made before the control system can be implemented. Several contingencies must also be considered. One of the first decisions that must be made is where to place the controls and what needs to be controlled. Jared also knows the organization is relatively small and will be for some time, and that management intends to decentralize extensively. Furthermore, management has indicated that
if- then guidelines are to be implemented. Jared looks forward to designing a system that will work well for the company for years to come.
-The first step deals with which of the following characteristics of effective control systems?

• A)strategic placement
• B)understandability
• C)accuracy
• D)multiple criteria

---

Definitions:

Capital Stock

The total amount of physical goods a company owns for the purpose of production, including buildings, machinery, and equipment.

Productivity

The measure of the efficiency of production, often quantified as the ratio of output to input in the production process.

Investment

The purchase or construction of any new plant, equipment, or residential housing, or the accumulation of inventory; represented by I.

National Income

The total income earned by a country's population, including wages, profits, and rent, and the sum of all incomes earned by individuals and businesses.