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CMA Foundation · Fundamentals of Business Economics and Management · Organisation Structure, Responsibility, Accountability and Delegation of Authority

Which statement correctly distinguishes power from authority?

Power is the capacity to influence others' behaviour and can exist without any formal position, for instance through expertise or personality. Authority is the legitimate right that comes with a position in the organisation. Hence they are not identical, and authority is the formally conferred form of influence.

  1. APower is the ability to influence others' behaviour and may exist without a formal position, whereas authority is the legitimate right that comes with a positionCorrect
  2. BPower is always delegated from superior to subordinate, whereas authority is acquired through personal expertise
  3. CPower and authority are identical because both arise only from the organisation chart
  4. DAuthority is the obligation to perform assigned duties, whereas power is the obligation to report results

Explanation

Power is the capacity to influence and can come from expertise or personality, so an informal leader may hold it. Authority is formally conferred by position. The other options reverse or confuse these meanings and describe responsibility or accountability instead.

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