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Which of the following describes the activity of a firm that assigns specific functions, such as accounting or legal work, to other organizations rather than performing these functions themselves?


A) functional sharing
B) outsourcing
C) benchmarking
D) virtual distribution

E) All of the above
F) B) and C)

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The marketing department manager at Creative Counselors International made a strong push to hire professionals with superior performance records in prior jobs. It didn't take long for these enthusiastic marketers to recognize the many talents within their department. They admired at how alike they were and how they seemed to agree with each other's work styles and ideas. After a while, it became difficult for others in the organization to present to this group. If the idea did not originate within the marketing team, marketers did not give it much credence. This phenomenon is called


A) departmentalization clique.
B) interoffice competition.
C) forward thinking friction.
D) groupthink.

E) A) and B)
F) B) and C)

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A hierarchy requires many top managers, but only a few middle managers.

A) True
B) False

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Small businesses often use a line organization model.

A) True
B) False

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Max Weber used the term ________ to describe middle managers whose job was to implement the orders of top management.


A) management
B) autocrats
C) staff personnel
D) bureaucrats

E) A) and B)
F) A) and D)

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Fayol believed that decision-making authority should remain in the hands of top management


A) in small organizations, but should be delegated to middle and first-line managers in large organizations.
B) in large organizations, but could be delegated to middle and first-line managers in small organizations.
C) in all types and sizes of organizations.
D) only in organizations subjected to significant government regulation.

E) C) and D)
F) All of the above

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Organization theorists emerged during the era of mass production, meaning


A) the development of ways to produce a large quantity of product efficiently.
B) the development of ways to purchase raw materials in bulk.
C) the decline in the cost of production due to an increase in the cottage industry.
D) the era when most companies adopted very similar methods of producing goods and services, which led to standardization of organizational design.

E) None of the above
F) A) and C)

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Excite Enterprises, a corporation of amusement parks, uses an accounting firm to handle the payroll and tax functions for the company. Using the services of another firm in this manner is an example of


A) outsourcing.
B) functional reassignment.
C) core competencies.
D) benchmarking.

E) B) and C)
F) All of the above

Correct Answer

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Rapid Response Security Firm, a company that provides on-site security services for malls and other retail environments, needs to review current procedures used by its professional officers to make certain they are in compliance with new laws. On crucial issues such as this, it is more important to gather information through the informal organization, as opposed to the formal organization.

A) True
B) False

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Organizing a business begins with


A) acquiring the necessary resources.
B) choosing the best qualified employees.
C) developing an efficient plan of action.
D) determining the work to be done.

E) A) and C)
F) None of the above

Correct Answer

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One disadvantage of the matrix style of organization is that it is more difficult to keep development projects on schedule. The model slows down the time from design to production, and then to market.

A) True
B) False

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Weber put great trust in the creativity, skills, and pride of employees and believed that managers should act more as coaches than as bosses.

A) True
B) False

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Including customers and suppliers on cross-functional teams violates the interests of stockholders.

A) True
B) False

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School Days Centers specialize in helping students with difficulties. With locations around the country, each center consists of a manager and several tutors and counselors. The counselors and tutors have a great deal of flexibility to design programs specifically for individual students. In fact, these first-line employees are considered to be the key people in the organization, and the manager's main function is to assist these employees in matters such as scheduling and securing necessary materials. This type of arrangement suggests that School Days is an inverted organization.

A) True
B) False

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Which of the following describes the redesigning of an organization so that it can more effectively and efficiently serve its customers?


A) reinventing
B) restructuring
C) radical reorganizing
D) extroverted reorganizing

E) A) and B)
F) A) and C)

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Clear communication among workers and keeping order in materials and people are included in Fayol's principles.

A) True
B) False

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Matrix organization structures provide for more efficient use of organizational resources.

A) True
B) False

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Improvements in information technology have permitted companies to increase their span of control.

A) True
B) False

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Division of labor refers to deciding how many jobs must be accomplished and then dividing them up amongst the labor force.

A) True
B) False

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A(n) ________ is a visual device that shows relationships among people and divides the organization's work.


A) organization chart
B) Venn diagram
C) corporate tree
D) Gantt chart

E) B) and D)
F) None of the above

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