PBMF Chapter 5 Business Organization Review

Most businesses do not use a functional organizational structure.

• True

• False

All businesses make products.

• True

• False

About what percentage of U.S. businesses employ more than 100 workers?

• 5%

• less than 1%

• 20%

• 35%

A written legal document defining ownership and operating procedures and conditions for a corporation is called the

• articles of incorporation.

• partnership agreement.

• corporate code of ethics.

• articles of confederation.

A unique business organized by two or more other businesses to operate for a limited time and for a specific project is called a

• nonprofit corporation.

• limited liability partnership.

• joint venture.

• limited liability company.

The right to make decisions about how responsibilities should be achieved is called

• span of control.

• accountability.

• liability.

• authority.

A major advantage of a functional organizational structure is that

• all of the people with similar jobs will be paid the same salary.

• people often become more focused on their specific function than on the success of the whole business.

• people work with others who have the same skills.

• people working in one function have little interaction with people in other parts of the business.

The Great Recession from 2007 through 2009 resulted in a loss of more than 15 million jobs. The same number of jobs had been returned by 2014.

• True

• False

A span of control is a diagram that shows the structure of an organization.

• True

• False

Every business performs all of the following activities EXCEPT

• buying goods and services.

• manufacturing products.

• raising capital.

• maintaining business records.