GAMBELLA UNIVERSITY-GREEN RESEARCH AND
DEVELOPMENT INSTITUTE COLLABORATIVE GRADUATE
PROGRAM
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Name of Student :- Nean Amhara Nyigwo
ID NO: WPG/510/2014
Course Title :- Managerial Economics
Course Code :- (MBA 562)
Credit Hours : 3
Name of the Instructor : Dr. Negussie Semie (Ph.D)
0911 892049
nsemie@yahoo.com
Submitted Date :- December 24 -2022
JOURNAL ARTICLE :- MANAGERIAL
INCENTIVE AND PRODUCT MARKET
In this article derive the optimal incentive
scheme for a manager as a function of the
competitiveness of the environment in which
his firm operates,
the Major basic impact of increased competition is
that it reduces the profits of a Business also two
effect of the Model such as ,if firm has costs the
reduction of the profit may be sufficient to render
the firm unprofitable hat it has to be liquidated and
reduction in profits may affect the profitability of
costs-reduction its effect of double sign.
STRENGTHS
This has further fostered the desire of an increase in
competition as two effects on managerial incentives: It
increases the probability of liquidation, which has a
positive effect on managerial effort, but it also reduces the
firm's profits, which may make it less attractive to induce
high effort.
Manager for control devices for checking
underwriting. The aim is to achieve a more
competitive for Profit and reduction they also
need a picture of company operations from a
"going concern" standpoint, as well as the
safety viewpoint given in the Annual firm
planning. Managerial needs to be informed
promptly of what has.
The major of Strength as:Identifying
Measuring
Analysis
Interpreting
Communicating & Information
WEAKNESSES
The Weaknesses of this Article Single Business or Firm,
Competitive environment of firm as exogenously given.
LESSON DRAWN
In this Article the most important learning is increasing
competition increases the probability that firms with
managerial slack are forced into liquidation
And then other important bold for in this journal in ours country
Ethiopia including outside “ If the net present value of the firm's
future cash flow exceeds its liquidation value, then creditors may
forgive some of the debt in order to keep the firm as a going
concern”