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Thoeries underlying the Objective of a Firm, mainly talk about the subject of Ethics in Business.
Debate is going on since a long time, as to whether every Firm's Objective needs to be ETHICAL?
the answer may seem as simple as "YES", but the counter arguements that follow are difficult to answer.
Does a Cigratte Manufacturing Company have an ethical objective? Are Liquior Producers into Ethical Business?
These Companies thrive at the cost of Consumer's Health. Nevertheless they are highly Profit Making.
Coming to Profit Maximization, the question goes as to whether Profit Maximization Goal is justitfied?
In a private enterprise, no one can have control over Profit maximization. If the profits are made with the use of Society's resources, such profits need to be sowed back for Societal Development.
Abnormal Profits/Supernormal Profits indicate the presence of Monopoly, new entrants and market expansion can keep a check on Monopoly, which is a matter of time.
Gyan Prakash Singh
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MBA(IT)
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Why profit maximization is not regarded as the core financial objective of firm?
Profit Maximization is a short term objective as all it aims for is to generate a higher revenue for the period.This objective is generally followed if the firm is highly leveraged and a higher profit is required to service it. Wealth Maximization is followed as it looks to increasing the market value of the firms share capital and thus leads to an overall development of the firm and its capacity.
Explain the rationale for selecting shareholders wealth maximizatio as the objective of the firm?
Explain the rationare for selecting shareholder wealth maximization as the objective of the firm.Include a consideration of profit maximization as an alternative goal
What are the difference between value maximation and profit maximation?
Value maximization and profit maximization are very much related, the main difference being- value maximization means increases in owners' wealth achieved by maximizing of the value of a firm's common stock. profit maximization is the process by which a firm determines the price and output level that returns the greatest profit. the other difference among the two could be sited as- value maximization is seen as long term objective of a firm, whereas profit maximization is generally a short term objective.
Explain why judging the efficiency of financial decision requires the existence of a goal?
The goal of the firm is wealth maximization so efficient financial management requires the existence of goal or objective. The goal of the firm is earning market per share but we can know about best company by finding it's market share price. It is a reflection of the firm's investment, financing, and asset management decisions.
In financial theory the objective is to maximize shareholder wealth and not maximize profit?
Maximizing shareholder wealth and maximizing profit goes hand in hand. A firm maximizes shareholder wealth by investing in projects that will increase profits and the cash flows of the firm, finding ways to prudently cut variable and fixed operating costs and creating products that will increase revenues. The firm's executives must also manage the company and its operations in a fiscally responsible manner in order to increase the profitability of the company. By taking these steps the firm therefore increases the shares of its stocks which increases shareholder wealth.
Why it is important to develop various theories of firm?
why is it important to develop various theories of firm?
What are the objectives of a firm?
The objective of the firm is the goals that a firms desires to achieve. In most cases, the objective will be to make profits.
Why Profit Maximisation is the main objective of a firm Discuss this statement with the help of an example?
1. Profit Maximisation is the main objective of a firm" Discuss this statement with the help of an example.
Why Profit maximization can never be the objective of a firm?
Profit maximization IS an objective of a firm, but its not the ONLY objective. A firm will have different long term and short term goals which will vary depending on the current business cycle. If you need a more specific answer, please ask a more specific question. - Stavka
Critically X-Ray what constitutes the financial objective and economic objectives of a firm?
what constitutes a financial objective of a firm is the goals, long range planning and business. while that of the economic objective has to do with enviromental scanning and swot analsis
What is an underlying objective?
An underlying objective refers to the main goal or purpose that serves as a foundation for other goals or actions. It is the fundamental aim that influences decision-making and guides the direction of an individual or organization's activities. Identifying underlying objectives can help ensure alignment and clarity in pursuit of overall goals.
What are the aims and objectives of partnership firm?
The aims and objectives of a partnership firm is to provide a service and be successful. All businesses have the same objective and that is to survive.
Traditional economic theory has assumed that the typical firm has a single objective?
Maximize its profits
Why profit maximization is not regarded as the core financial objective of firm?
Profit Maximization is a short term objective as all it aims for is to generate a higher revenue for the period.This objective is generally followed if the firm is highly leveraged and a higher profit is required to service it. Wealth Maximization is followed as it looks to increasing the market value of the firms share capital and thus leads to an overall development of the firm and its capacity.
What is the use of objective and systematic observation to test theories on that is often employed by sociologists?
The Scientific Method
What is the use of objective and systematic observation to test theories one that is often employed?
The scientific method
What is the use of objective and systematic observation to test theories one that is often employed by sociologists?
Objective and systematic observation is used by sociologists to gather data and evidence that can be used to test theories and hypotheses. By observing behavior in a structured and objective manner, sociologists can gather reliable information that can help validate or refine sociological theories. This method allows researchers to study patterns and relationships within society in a rigorous and empirical way.
