You Are Assigned to a Team Responsible for Evaluating Segment

question 46

Essay

You are assigned to a team responsible for evaluating segment managers' performance measures.A team member has indicated that a friend who is a manager at a competitor's company is evaluated using "ROI",but does not know what "ROI" is.
a.Explain what ROI is and why it is a useful tool in measuring managers' performance.
b.Give an example of when ROI would not be an appropriate performance measurement.

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Definitions:

Limited Partners

Individuals in a partnership who have limited liability to the extent of their investment in the company and do not participate in day-to-day management.

Limited Partner

A partner in a business venture who doesn't participate in daily operations and whose financial responsibility is capped at their investment level.

Limited Partnership

A limited partnership is a business structure with at least one general partner, who manages the business and is fully liable, and one or more limited partners, whose liability is restricted to their investment.

Limited Partner

An investor in a partnership who has limited liability to the extent of their investment and does not take part in day-to-day management.