The President of Digital Equipment Corporation Discovered That His Company

question 60

Multiple Choice

The president of Digital Equipment Corporation discovered that his company was having a problem with counterproductive product groups who were working selfishly rather than cooperating with one another.To solve the problem,he combined the company's twelve U.S.product groups into three regional management centers.This solution is referred to as departmentalization by

• A) location.
• B) function.
• C) product.
• D) customer.
• E) objective.

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Definitions:

Saving Benefits

The advantages gained from setting aside income or resources for future use, including accruing interest, financial security, and preparedness for emergencies.

Substitution Effect

This refers to the economic theory that as prices rise or fall, consumers will replace more expensive items with less costly alternatives.

Income Effect

Refers to the change in an individual's or economy's income and how that change will affect the quantity demanded of a good or service.

Tax Rate

The rate at which taxes are applied to an individual or a corporation’s income.