Which of the Following Is a Potential Drawback of the Worldwide

question 60

Multiple Choice

Which of the following is a potential drawback of the worldwide area structure?

• A)It encourages fragmentation of the organization into highly autonomous entities.
• B)It is inconsistent with a localization strategy.
• C)It discourages local responsiveness.
• D)It is not suitable for firms with a low degree of diversification and a domestic structure based on functions.

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Definitions:

Google and Facebook

Leading technology companies known for their vast internet influence in search (Google) and social networking (Facebook).

Internet Markets

Markets that operate online, enabling buyers and sellers to transact over the internet, which often leads to reduced costs and wider geographical reach.

Network Effects

The effect that additional users of a good or service have on the value of that product to others, typically increasing the value with more users.

Natural Monopoly

A market structure where a single firm can provide a good or service at a lower cost than any potential competitors, usually due to economies of scale.