where MC=MR. TR increasing. each unit produced gives no extra loss or profit. provides greater wages, interest of owners/shareholders, further investment
1 of 6
REVENUE MAXIMISATION
MR=0. TR highest. each extra unit sold generates no extra revenue.
2 of 6
SALES MAXIMISATION
AC=AR. aim is to sell as much of the good/service as possible without making loss. eg amazons kindle launch- sold as much as possible to gain market share so they can earn more profit in LR, helps keep out and deter competitors.
3 of 6
SATISFICING
profit satisfying is earning just enough to keep shareholders happy. shareholders want profit- earn dividends from them. managers might not want to earn profit as their personal reward is small in comparison. divorce between owenership and control
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STATE OF ECONOMY
state of the economy influences firms objectives. less likely to adopt a profit maximising objective if the economy is in recession
5 of 6
DIAGRAM
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6 of 6
Other cards in this set
Card 2
Front
MR=0. TR highest. each extra unit sold generates no extra revenue.
Back
REVENUE MAXIMISATION
Card 3
Front
AC=AR. aim is to sell as much of the good/service as possible without making loss. eg amazons kindle launch- sold as much as possible to gain market share so they can earn more profit in LR, helps keep out and deter competitors.
Back
Card 4
Front
profit satisfying is earning just enough to keep shareholders happy. shareholders want profit- earn dividends from them. managers might not want to earn profit as their personal reward is small in comparison. divorce between owenership and control
Back
Card 5
Front
state of the economy influences firms objectives. less likely to adopt a profit maximising objective if the economy is in recession
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