MBA 705 EXAM 4 MCLAUGHLIN
(LSUS)Test Questions Well Answered
2026 Set.
organizational structure - Answer the formal means by which work is coordinated in an
organization. The structure exists to provide control and coordination for the organization
simple structure - Answer each employee does multiple tasks, manager involved in
everything
span of control - Answer the number of subordinates who report directly to a manager
vertical growth - Answer increase in the level of the organization's hierarchy (i.e. levels of
management)
tall organization - Answer many hierarchical levels and narrow spans of control
flat organization - Answer few levels in its hierarchy and a wide span of control from top to
bottom.
centralization - Answer most decisions are made by top management
decentralization - Answer decision-making authority is given to lower levels in an
organization's hierarchy.
horizontal growth - Answer an increase in the breadth of an organization's structure
downsizing - Answer occurs when one or more hierarchical levels—typically middle managers
—is eliminated.
four structural forms - Answer 1.Functional Structure- organize by functions.
2.Product Divisional Structure- organize by products.
3.Geographic Divisional Structure- organize by geography.
4.Matrix Structure- combine functional and product divisional structures.
, functional structure - Answer }Each subunit of the organization engages in firm-wide
activities related to a particular function, such as marketing, human resources, finance, or
production.
}Common to new organizations
}Emphasizes specialization
}Fosters development of economies of scale
product divisional structure - Answer }Divides the organization's activities into self-contained
entities, each responsible for producing, distributing, and selling its own products.
}Focus on products, the "real source" or success for the firm
}Pinpointing the responsibility for profits or losses is also easier because each product division
becomes a profit center—a well-defined organizational unit headed by a manager accountable
for its revenues and expenditures.
profit center - Answer a well-defined organizational unit headed by a manager accountable
for its revenues and expenditures.
geographic divisional structure - Answer }Activities and personnel are grouped by specific
geographic locations.
}Useful when two or more divisions can be dissected easily along geographical lines
}Attractive when there are substantial differences in various geographical regions
matrix structure - Answer }A combination of the functional and product divisional structures
}Members have "two (or more) bosses," one for the functional area and one or more for the
project area(s)
}Attractive when the organization faces a high degree of technological change, but can be
confusing and complex
considerations when choosing an organization structure - Answer }Level of corporate
involvement in business unit operations
}Compatibility of the structure with the corporate profile and the corporate strategy
}Number of hierarchical levels in the organization
}The extent to which the structure permits the appropriate grouping of activities
}The extent to which the structure promotes effective coordination
}The extent to which the structure allows for appropriate centralization or decentralization of
authority
corporate involvement in buisness unit operations - Answer }The extent to which corporate
managers are involved in business-level operations varies from one firm to another.
(LSUS)Test Questions Well Answered
2026 Set.
organizational structure - Answer the formal means by which work is coordinated in an
organization. The structure exists to provide control and coordination for the organization
simple structure - Answer each employee does multiple tasks, manager involved in
everything
span of control - Answer the number of subordinates who report directly to a manager
vertical growth - Answer increase in the level of the organization's hierarchy (i.e. levels of
management)
tall organization - Answer many hierarchical levels and narrow spans of control
flat organization - Answer few levels in its hierarchy and a wide span of control from top to
bottom.
centralization - Answer most decisions are made by top management
decentralization - Answer decision-making authority is given to lower levels in an
organization's hierarchy.
horizontal growth - Answer an increase in the breadth of an organization's structure
downsizing - Answer occurs when one or more hierarchical levels—typically middle managers
—is eliminated.
four structural forms - Answer 1.Functional Structure- organize by functions.
2.Product Divisional Structure- organize by products.
3.Geographic Divisional Structure- organize by geography.
4.Matrix Structure- combine functional and product divisional structures.
, functional structure - Answer }Each subunit of the organization engages in firm-wide
activities related to a particular function, such as marketing, human resources, finance, or
production.
}Common to new organizations
}Emphasizes specialization
}Fosters development of economies of scale
product divisional structure - Answer }Divides the organization's activities into self-contained
entities, each responsible for producing, distributing, and selling its own products.
}Focus on products, the "real source" or success for the firm
}Pinpointing the responsibility for profits or losses is also easier because each product division
becomes a profit center—a well-defined organizational unit headed by a manager accountable
for its revenues and expenditures.
profit center - Answer a well-defined organizational unit headed by a manager accountable
for its revenues and expenditures.
geographic divisional structure - Answer }Activities and personnel are grouped by specific
geographic locations.
}Useful when two or more divisions can be dissected easily along geographical lines
}Attractive when there are substantial differences in various geographical regions
matrix structure - Answer }A combination of the functional and product divisional structures
}Members have "two (or more) bosses," one for the functional area and one or more for the
project area(s)
}Attractive when the organization faces a high degree of technological change, but can be
confusing and complex
considerations when choosing an organization structure - Answer }Level of corporate
involvement in business unit operations
}Compatibility of the structure with the corporate profile and the corporate strategy
}Number of hierarchical levels in the organization
}The extent to which the structure permits the appropriate grouping of activities
}The extent to which the structure promotes effective coordination
}The extent to which the structure allows for appropriate centralization or decentralization of
authority
corporate involvement in buisness unit operations - Answer }The extent to which corporate
managers are involved in business-level operations varies from one firm to another.
