Which of the Following Statements About Performance Evaluation Is True

question 3

Multiple Choice

Which of the following statements about performance evaluation is true?

• A) Non-financial measures are less useful than financial measures because they are not as objective
• B) Financial measures are less useful than non-financial measures because they are biased
• C) A combination of financial and non-financial measures gives a more useful picture of organisational performance than either one alone
• D) Only one or two non-financial performance measures should be used

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Definitions:

Cost

The expenditure incurred in the production of goods or services, including time, labor, materials, and financial resources.

Technological Advance

The development and application of innovative tools, machines, materials, and processes that improve efficiency and productivity.

Allocative Efficiency

A state of resource allocation in which it is impossible to make anyone better off without making someone else worse off, often achieved when the value placed on goods and services by consumers is aligned with the costs of producing them.

Productive Efficiency

A state where an economy or entity can no longer produce more of one good without reducing the production of another good, implying that production occurs at the lowest possible cost.