Participative Budgeting Has Which of the Following Potential Problems

question 117

Multiple Choice

Participative budgeting has which of the following potential problems?

• A)building slack into a budget
• B)encourages individual behavior that is in basic conflict with the goals of the organization
• C)using budgets as a part of performance evaluations could lead to unethical behavior
• D)managers take action that will improve performance in the short run but has long-term consequences

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Definitions:

American Consumers

Individuals or households in the United States engaging in the consumption of goods and services.

Natural Monopoly

A market structure where a single firm can supply a good or service to an entire market at a lower cost than could two or more firms due to economies of scale.

Economic Power

The capacity of an entity, whether a nation, corporation, or individual, to influence or control economic activities and outcomes.

CEO Compensation

The total remuneration package, including salary, bonuses, and stock options, offered to the chief executive officer of a corporation.