MANAGERIAL ACCOUNTING FOR MANAGERS EBOOK
MANAGERIAL ACCOUNTING FOR MANAGERS EBOOK
6th Edition
ISBN: 9781264445615
Author: Noreen
Publisher: MCG
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Chapter P, Problem P.11E

1.

To determine

Concept Introduction:

Motivating means to be work done by other in an effective and efficient way. In other words we can say the motivate means to give the employees an energy to be work done in a best possible way.

Do you agree with the statement above in the question?

2.

To determine

Concept Introduction:

Motivating means to be work done by other in a effective and efficient way. In other words we can say the motivate means to give the employees an energy to be work done in a best possible way.

Requirement 2

As a manager would you seek to motivate the employees?

3.

To determine

Concept Introduction:

Motivating means to be work done by other in a effective and efficient way. In other words we can say the motivate means to give the employees an energy to be work done in a best possible way.

Requirement 3

The financial incentives to compensate the employees.

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Indicate whether the statement is true or false, and justify your answer.Economists agree that any intervention at time t which improves the utility of people at time t is necessarily a good intervention.
We talk about a problem in Corporate Governance in active monitoring. A monitor learns about the Bad Project, which yields private benefit B, with probability M. The monitor learns nothing with probability 1-M. This probability of M of effective monitoring (=monitoring level) is dependent on the effort cost or what we call disutility of effort g(M) incurred by this monitor. It is assumed that disutility of effort is increasing g’()>0 and convex g’’()>0. We also assume that g’(0) and g’(1) = ∞. Let Rb be the borrower’s reward. In successful case, its value is b/Δp < Rb < B/Δp. Let Rm be the monitor’s payoff in a successful case. The question is: Show the Net Present Value of the project for monitoring level M.
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