Chapter 22 QuizA consequence of a manager meeting her division’s pre-determined quarterly production goals could be:a. Shirking at the end of the quarterb. All of these choicesc. A performance bonusd. A higher goal next quarterA Cost Center is:a. Rewarded based on the lower the costs the division incursb. Rewarded based on the higher profits of the companyc. Rewarded based on the lower profits of the divisiond. Rewarded based on the higher profits of the divisionA functional organization form is one in which divisions specialize bya. Tasks to be performedb. Customer typec. None of these choicesd. Region in which they operateA manager whose bonus is proportional to the number of distinct goals she achieves each quarter:a. All of these choicesb. Will try to meet goals by a wide marginc. Will work equally hard to meet all goalsd. Will decrease effort toward each goal as it becomes clear it will be metA strength of a process team organization over a functional form organization is:a. Clear communications across divisions serving different consumer groups.b. Clear responsibility for customer care throughout the production processc. Gains from having similar expertise within a divisiond. Clear promotion standards based on developing your specific skill set without regard to the other skills within a divisionAn process team organized firm is one in which divisions specialize bya. BOTH the region in which they operate AND customer typeb. Region in which they operatec. Tasks to be performedd. Customer typeConflicts exist between divisions becausea. The person making the production decisions for an intermediate good does not care how they affect other divisionsb. Divisions may place unreasonable demands on intermediate good qualityc. All of these choicesd. Divisions may not agree on the transfer price to be charged between divisionsIdeally, transfer prices would be set at:a. Average variable costb. Marginal Costc. The cost of purchasing something similar from outsided. Average costIf the transfer price is set too low:a. Downstream divisions may unprofitably purchase from outside suppliersb. Upstream divisions may be compensated too muchc. Upstream divisions may produce too few units of the intermediate goodd. Downstream divisions may demand too little of the intermediate goodProfit Centers are:a. Rewarded based on the higher profits of the divisionb. Rewarded based on the lower profits of the divisionc. Rewarded based on the higher profits of the companyd. Rewarded based on the lower the costs the division incurs
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