Business Objectives Flashcards
1
Q
What is profit maximisation
A
MC=MR
2
Q
What is revenue maximisation
A
MR=0
3
Q
What is sales maximsation
A
AR=AC
4
Q
What is profit satisficing
A
when firms make enough profit to keep stakeholders happy but can also focus on other objectives
5
Q
why might firms profit maximise
A
pay dividends
reinvest back into the business
6
Q
why might firms revenue maximise
A
increase market share
prestige
managerial benefits
7
Q
why might firms sales maximise
A
increase market share
prevent others entering market
8
Q
why might firms profit satisfice
A
to keep shareholder happy
focus on other objectives
