BACHELOR OF BUSINESS ADMINISTRATION

Detailed explanation-1: -Profitability is a measure of a company’s ability to generate maximum revenue while incurring minimal costs. In the most basic sense, profit goes up as sales increase and/or costs decrease.

Detailed explanation-2: -Profit maximisation is a process business firms undergo to ensure the best output and price levels are achieved in order to maximise its returns. Influential factors such as sale price, production cost and output levels are adjusted by the firm as a way of realising its profit goals.

Detailed explanation-3: -Profit Maximization, as its name suggests, refers to the company’s profit should be increased, while Wealth Maximization aims to accelerate the entity’s value. Profit maximization is the primary goal of concern since profit acts as the measure of efficiency.

Detailed explanation-4: -The profit-maximizing choice for the monopoly will be to produce at the quantity where marginal revenue is equal to marginal cost: that is, MR = MC. If the monopoly produces a lower quantity, then MR > MC at those levels of output, and the firm can make higher profits by expanding output.

Detailed explanation-5: -Profit maximization theory is based on a traditional viewpoint but the modern business and financial concept value wealth maximization much more than profit maximization.