Chapter 1+2: F1

The primary objective of profit organizations is to maximize profit.

• True

• False

The primary objective of Not-for-profit organizations is to reduce costs of their operations and thus minimize the burden on taxpayers.

• True

• False

The primary objective of profit organizations is to maximize the output of goods or services.

• True

• False

Charities would usually be classified as a type of non-governmental organisation (NGO)

• True

• False

The interests of customers and shareholders can often appear to conflict – for example in the quality of goods and services.

• True

• False

A company is using a communication strategy aimed at explaining the rationale behind its actions to its stakeholders. Using Mendelow’s matrix, these stakeholders would be categorised as ‘minimal effort’.

• True

• False

Which of the following is NOT a key feature of an organisation?

• Controlled performance

• Collective goals

• Social arrangements

• Creation of a product or service

Which of the following organisations is normally found in the public sector?

• Schools

• Charities

• Clubs

• Businesses

The public sector is normally concerned with:

• making profit from the sale of goods.

• providing services to specific groups funded from charitable donations.

• the provision of basic government services.

• raising funds by subscriptions from members to provide common services.

A Co is a company which specialises in forestry. It has recently purchased B Co, which runs a chain of recreational resorts. A has allowed B to build several new resorts on land which is owned by A, but which it is no longer able to use. The resorts have proven highly profitable and popular. Which of the following best explains the reason for the improved performance of the combined entity?

• Specialisation

• Social interactivity

• Synergy

• Service