Peter Wilson, CEO of TopGold, Announced, "As Part of Our

question 15

Multiple Choice

Peter Wilson, CEO of TopGold, announced, "As part of our cost-cutting campaign, we're going to remove two layers of management. That cost reduction will create an added benefit of preserving intact the corporate messages that I communicate from my office, to all levels of the organization. I'm afraid that, in the past couple of years, our employees have received distorted or incomplete messages after having passed through multiple layers of management." Peter was acknowledging that

• A)filtering of downward communication is less of a problem in flatter organizations.
• B)perception of downward communication is always positive in a flatter organization.
• C)open-book management can never be employed in a tall organization.
• D)information overload is always a problem in tall organizations.
• E)inconsistent communication never occurs in a flatter organization.

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Definitions:

Subchapter S Corporation

A form of corporation that meets specific Internal Revenue Code requirements, offering the benefits of incorporated status while being taxed as a partnership.

Stockholder Basis

The amount of a stockholder's investment in a company, used to determine capital gains or losses for tax purposes.

Capital Contributions

Investments of cash or other assets made by owners or partners into a business, increasing the equity of the company.

Net Income

The total earnings of a company after subtracting all expenses, taxes, and costs from its total revenue, representing the company's profit.