In Designing the Organizational Structure, Management Knows Two Concerns, __________

question 42

Multiple Choice

In designing the organizational structure, management knows two concerns, __________ and __________, run counter to each other.

• A) finding the most effective way to departmentalize; coordinating activities
• B) earning profits; paying taxes
• C) hiring employees; reducing labor costs
• D) sales growth; research and design expenditures
• E) none of the above.

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Definitions:

Long-Run Equilibrium

A state in which all factors of production and inputs can be adjusted by firms, leading to a situation where no firm has an incentive to change its output or production method.

LRAC Curve

Long-Run Average Cost Curve, a graphical representation showing the minimum cost at which any output level can be produced in the long run.

Exiting Firms

Businesses that are leaving a particular market due to various reasons such as unprofitability, strategic realignment, or market saturation.

Increasing-Cost Industry

An industry in which production costs increase as the industry's output expands.