All of the Following Are Advantages of Decentralization Except

question 114

Multiple Choice

All of the following are advantages of decentralization except:

• A) Managers make better decisions when closer to the operation of the company.
• B) Expertise in all areas of the business is difficult, decentralization makes it better to delegate certain responsibilities.
• C) Each decentralized operation purchases their own assets and pays for operating costs.
• D) Decentralized managers can respond quickly to customer satisfaction and quality service.

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Definitions:

Transfer Price

The cost at which products or services are exchanged between departments or divisions within the same organization.

Castings Division

A specialized department within a manufacturing company focused on producing parts by pouring molten material into molds.

Machine Products Division

A specialized department or section within a company focused on the manufacturing and distribution of machine-based products.

Transfer Price

The price charged for goods or services sold between departments or subsidiaries within the same company.