In profit centers
A)Managers are difficult to evaluate because there is no simple metric of how well they performed
B)Managers typically do not have the information to run their division efficiently
C)Managers' decisions can affect other divisions
D)Managers typically do not have the incentives to run their division efficiently

Question

​In profit centers
A)​Managers are difficult to evaluate because there is no simple metric of how well they performed
B)Managers typically do not have the information to run their division efficiently
C)Managers' decisions can affect other divisions
D)​Managers typically do not have the incentives to run their division efficiently

Quizplus · Accepted Answer

In profit centers, managers have the authority to make decisions that can affect other divisions, so it is important for them to consider the impact of their decisions on the company as a whole. This can make evaluating their performance more complex than in other types of centers. Managers in profit centers also typically have incentives to run their division efficiently, as their unit's profitability directly affects their own compensation.

​In Profit Centers

In Profit Centers