Which of the Following Is a Disadvantage of Modular Organizations

question 9

Multiple Choice

Which of the following is a disadvantage of modular organizations?

• A) They cost significantly more to run than traditional organizations.
• B) They are characterized by a loss of control that occurs when key business activities are outsourced to other companies.
• C) They are slow because members cannot combine their efforts to meet customers' needs.
• D) They are unstable and have temporary relationships in a network alliance.

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Definitions:

Risk Averse

A characteristic of preferring to avoid risk, inclining towards guaranteed outcomes over potentially higher-yielding but uncertain ones.

Income

The accumulation of funds, characteristically on a habitual basis, through work or investing.

Von Neumann-Morgenstern

A theory of expected utility that describes how rational individuals choose among uncertain prospects, emphasizing the maximization of utility for decision-making under uncertainty.

Utility Function

A mathematical representation in economics that portrays an individual's preference ranking for different bundles of goods or outcomes.