A Rapidly Expanding Retail Organization Continues to Be Tightly Controlled

question 20

Multiple Choice

A rapidly expanding retail organization continues to be tightly controlled by its original small management team. Which of the following is a potential risk in this vertically centralized organization?

• A) Lack of coordination among different business units.
• B) Operational decisions are inconsistent with organizational goals.
• C) Suboptimal decision-making.
• D) Duplication of business activities.

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Definitions:

Fair Value

The cost incurred or received during the sale of an asset or transfer of a liability in a systematic transaction among market actors on the valuation date.

Undervalued

An economic condition where the market price of an asset falls short of its intrinsic or real value as evaluated by investors.

Overvalued

A descriptor for an asset or stock whose price is believed to be higher than its intrinsic value.

Trademark

A distinguishable symbol, pattern, or phrase that serves to differentiate the goods or services of one origin from those of another.