Return on Investment Cannot Be Used Effectively to Evaluate Profit

question 8

True/False

Return on investment cannot be used effectively to evaluate profit centres because it motivates managers to make suboptimal decisions from the viewpoint of the organizations' owners.

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Definitions:

Evaluating Duties

The process of assessing the responsibilities and tasks assigned to a role or position.

Vertical Loading

The process of increasing an employee's responsibility and authority, typically as part of their development or empowerment.

Job Depth

The degree to which a job requires a variety of skills, gives workers autonomy, and impacts the organization or its clients.

Automation

The use of technology to perform tasks without human intervention, often improving efficiency, reliability, and speed in processes.