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 rarely affect other divisions
D)Managers typically have ample incentives to run their division efficiently

Question

Quizplus · Accepted Answer

In profit centers, managers are responsible for generating revenue and controlling costs, and their success can be directly measured by the profitability of their division. Therefore, they have a strong incentive to run their division efficiently and maximize profits. This aligns with choice D, which states that managers typically have ample incentives to run their division efficiently. Choices A, B, and C are incorrect because managers can be evaluated based on financial metrics such as revenue, expenses, and profits, they typically have access to the information they need to make decisions, and their decisions can have an impact on other divisions in the company.

In Profit Centers