A Positional Externality Occurs When

question 21

Multiple Choice

A positional externality occurs when

• A)One person's increase in consumption lowers his neighbor's utility
• B)One person builds a house which obstructs his neighbor's view
• C)A polluter positions himself in a crowded city
• D)A drunk person decides to drive

Understand the impact of organizational size and complexity on structure and design.

Distinguish between vertical and horizontal organizational structures and their implications.

Grasp the concepts of formalization, centralization, and specialization in organizational contexts.

Appreciate the role of flexibility in organizational structures for creativity and efficiency.

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Definitions:

PDCA Cycle

A four-step management method used for the control and continuous improvement of processes and products, standing for Plan-Do-Check-Act.

Develop

The process of improving or enlarging an entity, concept, or skill set through education, training, or experience leading to growth and advancement.

Control

The process by which an organization ensures that activities are being executed according to plan and adjusts as necessary to achieve objectives.

Authorize

To officially empower someone or grant permission for something to happen.