Delegation refers to the:

Downward transfer of authority from a superior to a subordinate

The correct answer is Option (4) - Downward transfer of authority from a superior to a subordinate.

Delegation refers to the downward transfer of authority from a superior to a subordinate. It is a pre-requisite to the efficient functioning of an organisation because it enables a manager to use his time on high priority activities. It also satisfies the subordinate’s need for recognition and provides them with opportunities to develop and exercise initiative. Delegation helps a manager to extend his area of operations as without it, his activities would be restricted to only what he himself can do.