Commercial Applications
A company faces criticism for taking too long to make decisions due to bureaucratic delays. Which disadvantage of joint stock companies is highlighted here?
- Lack of motivation
- Delay in decision-making
- Conflict of interests
- Unhealthy speculation
Joint Stock Company
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Answer
Delay in decision-making
Reason — Delay in decision-making is a major disadvantage of joint stock companies. Red tape and bureaucracy do not permit quick decisions and prompt action. There is little scope for personal initiative and a sense of responsibility. Paid employees like to play safe and tend to shift responsibility. This lack of flexibility of operations causes delays in important business decisions.
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