1. When an organization shares resources across several products and tasks, it is able to:
a. minimize transaction costs.
b. maximize transaction costs.
c. achieve economies of scale.
d. achieve economies of scope.
2. Because a toy maker sells a large amount of toys, it is able to acquire plastic products to make
the toys at a cheaper price than the competition. The toy maker is taking advantage of:
a. economies of scale.
b. economies of scope.
c. organizational culture.
d. organizational design.
3) ________ are cost savings that result when goods and services are produced in large volume on
automated production lines.
A) Economies of scope
B) Economies of scale
4) A large restaurant chain decides that they are going to start serving breakfast in order to better
utilize the expensive equipment that they purchased to cook with. They are taking advantage of:
A) economies of scope.
B) economies of scale.
C) transaction costs.
5) ________ are the costs associated with negotiating, monitoring and governing exchanges
A) Economies of scale
B) Economies of cost
C) Transaction costs
6) When local store managers attempt to spot trends and changes so they can respond to customer
needs, they are:
A) using large-scale technology.
B) exerting power and control.
C) managing the external environment.
D) increasing division of labor.
7) ________ is the study of how organizations function and how they affect and are affected by the
environment in which they operate.
A) Organizational behavior
B) Organizational theory
C) Organizational culture
D) Organizational structure
8) The process of selecting organizational structure and organizational culture is ________.
A) organizational design
B) organizational behavior
C) organizational domain
D) organizational environment
9) Which of the following is an outside stakeholder group?
D) the workforce
10) What was Tom LaSora’s impact on the union-management relationship at Chrysler?
A) The more conciliatory dealings has resulted in more agreements and better work
B) His hard line approach has made dealings much more hostile than either Ford or GM
C) His “customer first” approach has resulted in a superior dealer network.
D) His anti-union stance has resulted in overall lower automobile costs for the consumer.
11) When an organization tries to satisfy stakeholders, it faces all of the following problems except:
A) choosing which stakeholder goals to satisfy.
B) losing the ability to innovate.
C) deciding how to allocate organizational rewards to different stakeholder groups.
D) balancing short-term and long-term goals.
12) Balancing short-term and long-term goals is hard because:
A) official goals focus on the long-term and operative goals focus on the short-term.
B) official goals focus on the short-term and operative goals focus on the long-term.
C) stakeholder groups have different preferences for the time frame an organization
should use to pursue goals.
D) organizations do not place enough emphasis on operative goals.
13) The primary goal of capitalistic organizations is to:
A) maximize shareholder wealth.
B) form long-term relationships with suppliers.
C) satisfy employees.
D) satisfy customers.
14) The problem of doctors owning stock in hospitals is one of:
A) potentially competing goals.
B) organizational design.
C) organizational structure.
D) the conversion process.
15) The chain of command in a large organization is as follows:
A) CEO, president, senior vice presidents, executive vice presidents.
B) Board, CEO, executive vice presidents, presidents.
C) CEO, president, executive vice presidents, vice presidents.
D) President, divisional managers, executive vice presidents, vice presidents.
16) A company’s top-management team consists of:
A) functional and divisional managers.
B) the president and executive vice president.
C) executive vice presidents and vice presidents.
D) senior vice presidents and divisional managers.
17) Determining management’s rewards and incentives is primarily the responsibility of ________.
A) the board of directors
B) corporate management
C) the CEO
D) the shareholders
18) The specifi c environment:
A) consists of outside stakeholders.
B) includes international forces.
C) includes economic and technological forces.
D) contains forces that shape the general environment.
19) The ________ is/are the set of forces from outside stakeholder groups that directly affect an
organization’s ability to secure resources.
B) rites of passage
C) specifi c environment
20) The ________ is the set of forces that shape the specifi c environment and affect the ability of
all organizations in a particular environment to obtain resources.
B) team structure
C) product structure
D) general environment
21) The general environment:
A) consists of outside stakeholders.
B) consists of inside stakeholders.
C) is a reflection of an organization’s domain.
D) contains forces that shape the specifi c environment.
22) The Organizational Insight about the flower industry discussed the fact that the price of roses
has been dropping. What is the primary cause of this?
A) better supply chain management
B) more competition
C) poorer countries can grow roses for less money
D) All of the above.
23) ________ is/are a function of the strength, number and interconnectedness of the specifi c and
general forces that an organization has to manage.
A) Environmental complexity
B) Social responsibility
C) Organizational behavior
D) Individual ethics
24) When a company decides to produce different products for different customers:
A) the number of stakeholders decreases.
B) environmental complexity increases.
C) the organizational domain decreases.
D) environmental stability increases.
25) An organization’s environment will be more uncertain when:
A) many forces in the environment are interconnected.
B) many forces in the environment are not connected.
C) forces in the environment do not change much.
D) competition is low.
Organizational Theory, Design and Change
Sixth Edition, 2010
Gareth R. Jones
Pearson Prentice Hall