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What Are Some of the Limitations of Using ROI,residual Income,and

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Essay

What are some of the limitations of using ROI,residual income,and EVA to measure the performance of investment centers?


Definitions:

Descriptive Contingency

This refers to the assertion that there is no one universally applicable set of management principles (by structure or strategy), but that it depends on various external and internal constraints.

Descriptive Theories

Theories that explain and understand phenomena by describing patterns, behaviors, and relationships.

Effective

The degree to which something is successful in producing a desired or intended result; efficiency in achieving goals.

Influence Tactics

Methods or strategies used by individuals or leaders to persuade or guide the behavior and attitudes of others toward desired outcomes.

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