What are the four characteristics of knowledge that make it unlike other organizational assets?
What will be an ideal response?
• Extraordinary leverage and increasing returns. Knowledge is not subject to diminishing returns. When it is used, it is not decreased (or depleted); rather, it is increased (or improved). Its consumers can add to it, thus increasing its value.
• Fragmentation, leakage, and the need to refresh. As knowledge grows, it branches and fragments. Knowledge is dynamic; it is information in action. Thus, an organization must continually refresh its knowledge base to maintain it as a source of competitive advantage.
• Uncertain value. It is difficult to estimate the impact of an investment in knowledge. There are too many intangible aspects that cannot be easily quantified.
• Value of sharing. It is difficult to estimate the value of sharing one's knowledge or even who will benefit most from it.
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Assume you put $2,000 into a tax-free investment and leave it there for 45 years at an annual rate of 8%. According to the Rule of 72, your investment will grow to a value of about $64,000
Indicate whether the statement is true or false.
Which of the following is not an advantage of a CD as a cash management alternative?
A) CDs have fixed interest rates, which are beneficial if interest rates drop. B) CDs offer a wide selection of maturities. C) CDs are insured. D) CDs offer liquidity. E) CDs are convenient to purchase.