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problem: If budget performance is overemphasized, myopic behavior can occur where a manager takes actions that get better budgetary performance in the short run but cause long-run harm to the company.

Required:

[A] Give some exs of myopic behavior that might be encouraged if there is an overemphasis on budgets as a performance measure.

[B] Recognize and discuss the key features that a budgetary system should have to encourage managerial, goal-congruent behavior.

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M921399

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