Which of the Following Statements Describes the Relationship Between Organizational

question 98

Multiple Choice

Which of the following statements describes the relationship between organizational size and the number of managers? As an organization grows:

• A) an increase in the number of managers is more than proportional to the increase in size.
• B) an increase in the number of managers is less than proportional to the increase in size.
• C) it does not increase the number of managers.
• D) an increase in the number of managers is proportional to the increase in size.

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Definitions:

Variable Inputs

Variable inputs in production are those inputs that change in quantity with the level of output, such as raw materials and labor.

Inputs

The resources such as labor, materials, and capital that are used in the production process to create goods and services.

AFC

Acronym that stands for Average Fixed Cost, the fixed costs of production divided by the quantity of output produced.

ATC

Average Total Cost, which is the total cost of production divided by the number of goods produced.