Because Organizational Change of Any Type Can Be Disruptive and Scary

question 119

Multiple Choice

Because organizational change of any type can be disruptive and scary, an entrepreneur must support the change efforts by ____________.

• A) preparing a new business plan
• B) motivating employees to put forth their best efforts
• C) hiring new employees to fit with the proposed changes
• D) changing the company culture to fit with the changes
• E) hiring an external consultant to help the change process

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Definitions:

Cost Behaviors

The way in which costs change in relation to changes in a firm's level of production or activity, including fixed, variable, and mixed costs.

Variable Cost

Costs that change in proportion to the level of production or activity.

Operating Leverage

Refers to the extent to which fixed costs are used in a company's operations; high operating leverage means a larger proportion of fixed costs, leading to greater potential for profit variability with changes in sales volume.

Pretax Net Income

The amount of income that a company has earned before any taxes have been deducted.