Budgetary slack helps buffer managers from budget cuts imposed by higher-level management.

Question

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Budgetary slack involves intentionally overestimating expenses or underestimating revenues in a budget, which creates a cushion or buffer that managers can use to absorb unexpected expenses or performance shortfalls. This also provides a layer of protection for managers in case of budget cuts from higher-level management, as they can reduce the slack without significantly affecting the operation of the organization.

Budgetary Slack Helps Buffer Managers from Budget Cuts Imposed by Higher-Level