Three Objectives of a Firm:
- Profit Maximisation MR=MC (MC must be rising)
- Revenue Maximisation MR=0
- Sales Maximisation AR=AC
- Satisficing
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1) Profit Maximisation: Where the revenue gained from selling one more unit (MR) is exactly equal to the cost of producing one more unit (MC)
2) Revenue Maximisation: Selling output until the last unit sold adds nothing to TR, since the next unit sold will reduce TR. Assumes that the firm is ignoring all costs, or if there are no VC's.
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Purposes: To increase market share or To dispose all stock.
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