Which of the Following Statements Is True About Excessive Layering

question 71

Multiple Choice

Which of the following statements is true about excessive layering in hierarchy?

• A)Many layers of managerial hierarchy ensures a short time for information to travel up the hierarchy.
• B)Information remains undistorted when passed along the different layers of hierarchy.
• C)Many layers of managerial hierarchy ensures an organization's quick response to changing market conditions.
• D)Many layers of managerial hierarchy results in a long time for information to travel down the hierarchy.
• E)The usefulness of information will always increase with an increase in layering of hierarchy.

Know the rights of shareholders, including preemptive rights and implications of dual-class shares.

Identify factors that cause a difference between a stock’s market value and its intrinsic value.

Grasp the role of the marginal investor in determining stock prices.

Understand the basic principles of the dividend discount model in stock valuation.

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Definitions:

Sales Units

The total number of units of a product sold during a specific period.

Break-Even Point

The production level or sales volume at which total revenues equal total costs, resulting in neither profit nor loss.

Margin of Safety

The difference between actual sales and the break-even point, indicating the level of risk in not covering fixed costs.

Composite Units

A measure used in costing to represent a bundle or mix of goods or services treated as a single unit.