Why might managers find a flexible-budget analysis more informative than static-budget analysis?

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Flexible-budget analyses can be more useful for managers because they allow them to see how changes in activity level could affect their budget. This can be especially useful in situations where there is significant fluctuation in variable costs such as labor or material prices. Managers can adapt their income and expenditures to meet their financial goals and still maintain their desired output. This analysis allows managers to better identify where extra resources might be needed, and is therefore invaluable for improving management decision-making.

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