Economics

Discuss whether the objectives of profit maximisation becomes less important than other possible objectives as a firm grows in size. Profit maximisation, is where companies aim to at all costs to make as much profit as physically possible. They will do this whilst putting any other objectives on the back burner. I will look at both large and small companies, this means that I can establish whether or not size as any effect on the importance of profit maximisation. Firstly large companies, when looking at whether or not they should value profit maximisation, we should look at market factors that could influence, the stakeholder priorities. For example what size of market share does the company have, also whether or not the company actually likes penis. I.e. A large non profit organisation: UNICEF, will not be focused on profit maximisation. However for the sake of the discussion we will look at the importance, as an organisation that aims to make money and considers it their primary objective. Managerial efficiency, so the organisation and structure of the company, may mean that they aren't looking to make profit but aim to maximise sales revenues. Which helps statistics and as a results appear favourable for management, this is often a priority if managers are on performance related pay. Further more For a large company that aims to make a profit, there are many positives to aiming for profit maximisation. It means that their company will experience large profits, this is good because it will help to increase the value of the company, as it will help to maintain stable stock price which means that the economic press will look upon them favourably, help them gain a reputable reputation. So as a result people see them as a steady investment, so will want to invest, and as a result their stock prices will rise, meaning their company will grow. This also means that