Certified Government Financial Manager (CGFM) Practice Exam 2025 – Your All-in-One Guide to Exam Success!

Efficiency in performance measures is fundamentally about achieving the greatest output with the least amount of resources. Option B accurately captures this principle by emphasizing the relationship between resources used and the goods or services produced.

In a practical context, efficiency assesses how well an organization utilizes its assets—such as labor, materials, and capital—to produce desirable outcomes, thereby maximizing productivity. When organizations strive for efficiency, they are not only focused on increasing output but are also concerned with minimizing waste and optimizing resource allocation. This holistic approach leads to better financial sustainability and organizational performance.

Other options do not align as closely with this definition. Maximizing output regardless of resource use neglects the importance of cost-effectiveness and sustainability. Minimizing costs without measuring output could lead to poor quality products or services, ultimately affecting overall organizational success. Lastly, achieving outcomes without focusing on inputs ignores the critical balance of resource utilization that is necessary for true efficiency.