Identify an Advantage of Having Wide Latitude in Reducing a Company

question 48

Multiple Choice

Identify an advantage of having wide latitude in reducing a company workforce.

• A) It gives employers the option of hiring for peak needs and laying off employees if needs decline.
• B) It helps in protecting workers' jobs.
• C) It helps employees adjust to a new culture.
• D) It allows workers to keep more of their earnings regardless of the taxes they pay.
• E) It gives employees the advantage of accumulating many years of work experience in an organization.

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Definitions:

Diseconomies of Scale

The phenomenon where, as a firm expands, its costs start increasing per unit of output, usually due to inefficiencies and management challenges that arise with size.

Diminishing Returns

A principle stating that as investment in a particular area increases, the rate of profit from that investment, after a certain point, cannot continue to increase and may decrease.

Natural Monopoly

A market structure where a single provider is more efficient in supplying the entire market with a product or service, due to high fixed or startup costs.