Which of the Following Is True of a Functional Structure

question 43

Multiple Choice

Which of the following is true of a functional structure?

• A) It reacts quickly to environmental changes.
• B) It diminishes economies of scale compared to the divisional structure.
• C) It often results in hierarchy overload.
• D) It cannot work in small organizations.

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Definitions:

Investment Opportunity

A potential financial venture, property, or stock that could generate a favorable return.

Residual Income

The income that remains after deducting all operation and investment costs, including a minimum desired return on investment.

Required Rate of Return

The minimum annual percentage earned by an investment that will entice individuals or companies to put money into a particular project or investment.

Return on Investment

A measure used to evaluate the efficiency of an investment, calculated as the return (profit) of an investment divided by the cost of the investment.