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Q. Explain Profit Maximization Approach?
(i) Best Criterion on Decision-Making:- The goal of revenue maximization is regarded as the best criterion of decision-making as it offers a yardstick to judge the economic performance of the enterprises.
(ii) Proficient Allocation of Resources: - It leads to proficient allocation of scare resources as they tend to be diverted to those uses which in terms of profitability are the most desirable.
(iii) Optimum Utilization: - Optimum consumption of available resources is possible.
(iv) Utmost Social Welfare: - It make sure maximum social welfare in the form of timely payment to creditors, maximum dividend to shareholder, higher wages, better quality and lower prices, more employment opportunities to the society and maximization of capital to the owners.
discuss cost of capital in finance#
In how many area ratios are grouped Ratios can be grouped into 3 main areas: 1 Performance - how well business has done (profitability) 2 Position - short term standing
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Consider that you are deciding whether to undertake one of two projects. Project A involves buying expensive machinery which will produce a better product at a lower cost. The mach
Details on budgetary control process
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