The purpose of the assault rifle (such as the M-16) is not to kill. The intent is to wound or maim the target. This is more effective in battle in a number of ways:

First, it removes more men from the battle. Sounds odd, I know. Here is how it works. In a heated battle if a man is shot and killed nothing can be done about it. However if a man is wounded he must be cared for. So do the math: 1 man wounded + 2 men to carry him away from the front line = 3 men out of action. 3 > 1 man killed. Also it is bad for an army to leave a wounded man at the front this brings me to the second purpose of the assault rifle, to demoralize.

If it is not possible to remove a wounded man from the fighting, he will stay there and bleed and scream in pain. Sounds bad right? Now his fellow troops and friends see what the weapon did to this man, he is not dying a quick death. Also their own army does not seem to care enough about him to take him to a MASH or hospital. Who wants to fight for such pricks as these who would let my freind die a horrible slow death. There goes the will to fight of 7 or 8 of the enemy.

The assault rifle is as much a psychological weapon as a physical one.