Motivating honest budgets and profit expectations is difficult because some rnsubordinate managers will provide overly optimistic budgets to "look good" to rntheir bosses, while others will lowball budgets so they will "look good" when they rnexceed expectations. This paper explains how to motivate accurate forecasts of rnbudgets and profits.
Grade Level: High School (9-12)
Curriculum Topic Benchmarks: M1.4.7, M1.4.8, M2.4.9, M8.4.16, M8.4.17, M8.4.24, M9.4.4, M9.4.7
Subject Keywords: budget, equations, income, game theory, agency theory, motivation, managers, forecast
Author(s): Ted Bainbridge, Ph.D.
PUMAS ID: 04_03_16_1
Date Received: 2016-04-03
Date Revised: 2017-06-09
Date Accepted: 2016-09-13
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