What Is the Primary Reason for Simple Structures Being Perhaps

question 37

Multiple Choice

What is the primary reason for simple structures being perhaps the most common form of organizational design?

• A) There are more small organizations than large ones.
• B) Employees can come and go with no major ripple effects on the organization.
• C) Changes in specialization lead to less confusion about how exactly employees are supposed to do their jobs.
• D) Employees feel less emotionally attached to the firm.
• E) Approval for decisions need not be authorized at every step of the hierarchy.

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Definitions:

Depreciation Tax Shield

The tax savings achieved by a company from the allowance for depreciation expenses, reducing taxable income.

Depreciable Basis

The initial cost of an asset that can be depreciated over time for tax purposes, minus any salvage value.

Tax Savings

The reduction in income taxes that results from taking a permissible deduction from taxable income.