Decentralized decisionmaking is very controversial in a corporate environment. Central office managers feel like they are losing control of managers in specific plants or regional offices. What are some of the issues that must be reviewed before making the final decision on where to place final decision-making power?
What will be an ideal response?
Benefits of decentralization include more efficient use of local knowledge, ability to motivate local managers, and conservation of upper management time. Costs may arise from incentive conflicts, lack of coordination among local decision makers, and less effective use of central information. It may be acceptable to lose some control of local managers as long as a good incentive and evaluation system can be set up for local decision makers. In highly competitive markets, large organizations can respond more quickly to market changes when decisionmaking is decentralized.
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If fluctuations in interest rates become smaller, then, other things equal, the demand for stocks ________ and the demand for long-term bonds ________
A) increases; increases B) increases; decreases C) decreases; decreases D) decreases; increases
Average cost of production is
a. Total variable cost divided by total units produced b. Equal to marginal cost c. Total fixed cost divided by total units produced d. Total cost divided by total units produced
The cost of production on the "bottom forty" is $100,000 for a given size crop. On the "north forty," due to erosion of the soil, the cost is $150,000 . If both are being farmed by tenants, we would expect the rent on the "bottom forty" to be
a. $50,000 below the rent on the north forty. b. $50,000 above the rent on the north forty. c. different from that on the north forty by an indeterminable amount. d. $50,000 . and the rent on the north forty is $50,000.
If profit per unit equals (price - cost per unit) and costs are temporarily fixed, then the aggregate supply curve will have
a. a basic "U" shape. b. a negative slope. c. a positive slope. d. All of the above could be correct.