Question : Which of the following is true about functional structure?
Option 1: It is economical as there is minimal duplication of resources
Option 2: It is costlier as there is duplication of resources
Option 3: It is easier to fix responsiblity on each division
Option 4: Both (B) and (C)
Correct Answer: It is economical as there is minimal duplication of resources
Solution :
When the activities or jobs are grouped keeping in mind the functions or the job then it is called functional structure. It leads to minimum duplication of efforts this results in economies of scale and lowering of cost.
Hence, option 1 is the correct answer.