When Jane appeared for an interview at Incogyn Inc., she was promised a monthly pay of $7,500 after all tax deductions. However, after her first month at work, she received only $7,230. She filed a suit against the company on the grounds of misrepresentation of information, and the company incurred losses because of the amount it had to pay as fine. In the context of the general environment, this scenario best illustrates the effect of the on organizations.

T-comm makes a variety of products. it is organized in two divisions, north and south. the managers for each division are paid, in part, based on the financial performance of their divisions. the south division normally sells to outside customers but, on occasion, also sells to the north division. when it does, corporate policy states that the price must be cost plus 20 percent to ensure a "fair" return to the selling division. south received an order from north for 300 units. south's planned output for the year had been 1,200 units before north's order. south's capacity is 1,500 units per year. the costs for producing those 1,200 units follow