Which of the Following Is a Disadvantage of Decentralization

question 115

Multiple Choice

Which of the following is a disadvantage of decentralization?

• A) Decisions made by one manager may negatively affect the profitability of the entire company.
• B) Helps retain quality managers.
• C) Decision making by managers closest to the operations.
• D) Managers are able to acquire expertise in their areas of responsibility.

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Definitions:

Partnership Interest

An ownership share in a partnership, representing a partner's stake in the assets and operations of the business.

Ordinary Income

Income earned through wages, salaries, commissions, and interest, which is taxed at standard federal income tax rates.

Dividend Income

Money paid to shareholders out of a corporation's profits.

Current Distribution

This refers to the disbursement of a fund's or company’s earnings to its shareholders or partners.