The Practical Importance of Budgets Is That

question 37

Multiple Choice

The practical importance of budgets is that

• A)senior executives and divisional managers are held accountable against the figures in these budgets.
• B)the CEO is accountable to shareholders and analysts against these detailed predictions.
• C)the individual figures don't matter, it is the process by which the numbers were reached that matters.
• D)a and b.

---

Definitions:

Cost Curve

A graphical representation showing the cost of producing different quantities of output, typically illustrating concepts such as marginal and average costs.

Per Unit Costs

The average cost incurred for producing or acquiring one unit of a product or service.

Resource Prices

Refer to the market values assigned to natural or human-made materials that are used in the production of goods and services.

Inefficient Use

Utilization of resources in a way that is not optimal or does not maximize the potential outcome or benefit.