The correct answers are:

An organisation chart can confuse internal communications within a business

and

An organisation chart can indicate functional authority but not line authority within a business

Rationale: Line authority can easily be shown on the organisation chart.

Pitfalls: You may have hesitated if you didn't know the difference between functional authority (where an expert department has authority over the activities of other departments in the areas of its expertise eg the HR department setting recruitment policy for the sales and production departments) and line authority (direct authority flowing down the chain of command). However, you only needed to know the meaning of line authority to see that the statement was untrue.

Ways in: You may have paused to ask whether an organisation chart can improve or confuse internal communications, but it does improve in one key way: by highlighting the length and complexity of lines of communication between people who need to co-ordinate their work.