A management by objectives approach uses responsibility center budgets.

Question

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Management by objectives (MBO) approach involves setting specific goals and objectives for each department and employee within an organization. Responsibility center budgets are a critical component of the MBO approach as they assign financial resources to each department or responsibility center based on their specific objectives and goals. These budgets are used to evaluate performance and accountability towards achieving the set objectives.

A Management by Objectives Approach Uses Responsibility Center Budgets