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Budget slack refers to the practice of underestimating revenues or overestimating expenses to create a cushion in the budget. From an employee's perspective, the pros include reduced pressure to meet overly ambitious targets and the potential for easier performance evaluations, which can lead to job security and morale boosts. However, the cons include the risk of misallocating resources, stifling innovation, and fostering a culture of complacency, which can ultimately hinder both individual and organizational growth.
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