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Q. Show the Merits of residual income?
Merits of residual income (RI)
- Consistent or goal congruence with profit maximisation e.g. an enforced measure of profitability.
- Different interest charges (cost of capital) can be applied to divisions e.g. high inherent risk within different industries can have higher cost of capitals applied.
- Forces managers to consider cost of financing new investment and to be efficient when managing working capital for example minimisation of inventory and excessive cash balances.
Q. Recommended process to develop a performance measurement system 1. Senior management need to determine a clear vision of the change that will be required and demonstrate c
Q. Explain about hopwood’s Self-control? Self-regulation e.g. members of staff or managers exerting self-control by the modification of their own behaviour. This is essence de
Ask quest''Blue Ocean Strategy’ a. What is it? b. What are its characteristics? c. If you were to develop a Blue Ocean Strategy for a firm of your choice (any industry, any size,
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1. The development of the mass media has been shaped in fundamental ways by the fact that they have often been profit-driven. The commercial or capitalist context of media is evide
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what have you learnt about business strategy?
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