-In a decentralized organization,upper managers need a way to evaluate the performance of
Definitions:
Firm-Specific
Refers to risk or information that is unique to a particular company and not related to the market or industry.
Covariance
A measure used to determine how two variables change together, indicating the direction of the relationship.
Variance
A statistical measurement of the dispersion of data points in a data set around the mean, indicating the extent to which the numbers differ from each other.
Correlation Coefficient
A statistical measure that determines the degree to which two variables move in relation to each other, where +1 indicates a perfect positive correlation and -1 indicates a perfect negative correlation.
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