Essay On Profit Maximization

Typically, net profit is measured on a quarterly or annual basis. When compared with a company net profit during other periods, it can provide a useful measure for how profitable a company is over time and the overall performance of the company & management team.

When companies target consumers who are uninformed, they feed lies to the consumer, tricking them into buying something that they didn't want or even need. An example is when fast-food restaurants advertise a humongous burger. A consumer is intrigued with the size of this burger.But when they eventually purchase this burger, they are unsatisfied with the comparison of the advertisement and the actual product.

Profit maximisation is when firms maximise their profits through sales and increasing the price of products. Profit maximisation occurs when total sale revenue is furthest above total cost which is when MR= MC. Firms are usually controlled by the managers, in order for managers to keep its position its must gain enough or maximise the firms’ profits, so it can satisfy the shareholders. However managers may want to take a different approach rather than maximising the firms’ profits. Managers may want to maximise managerial objectives such as maximising its sales rather than profits. However although they are taking a different approach, they still must gain enough profits to satisfy the firms’ shareholders in order to avoid losing their

Throughout this task I will do my best to explain how firms determined to maximize profit do just that. Specifically I will delineate how such firms choose the optimum level of production or output for the goods they produce and how they behave with respect to various elevations of marginal revenue. In my attempt it will be appropriate for me to clarify the definitions of various economic terms in order to assure a proper understanding of my thoughts on this topic, I will provide these definitions throughout.

Next there is total cost and total revenue. Total cost is what the company spends to produce a certain quantity of its product. This includes the cost of all the materials,

When a firm wants to determine its optimal level of output using marginal revenue and marginal cost the firm needs these two to be equal. Marginal revenue is a change in the total revenue when one or even more units of output are sold. Marginal cost is the cost associated with producing one or more units. Optimal level of output is the desired level of goods or even service that is produced by a company. When the revenue and the cost become equal then the firm that uses profit maximization to determine the optimal level of output has succeeded.

Our approach is an active security selection with passive asset allocation. We invest heavily in common stocks, but vary our holdings to include companies of all sizes and industry groups. We seek to achieve sufficient diversification by abstaining from investing more than 5% of the total assets in a single security unless it has significant upside potential, and we make an exception for ETFs and index funds as they represent a basket of securities. Our main goal is to identify and invest in common stocks with high potential for both short- and long-term capital appreciation. Our secondary goal is to invest in common stocks with steady income. When potential for rewards are high, we also enter into derivative

These companies are being investigated by the National Development and Reform Commission. They are accused of violating Article 14 of the Anti-monopoly law by limiting the lowest prices offered to their

Because advertisements are purposely placed to be seen, it has become a part of our lives. Even when watching television there are constantly commercials trying to convince us to buy items that are often of a lower price. I’ve noticed that in these commercials they use tactics in order to try to engage the viewer. Not only do they show a low price but they often include multiple copies of the same item. For example, if there was a commercial about pillows, they would often include more than one of them for the same price. This makes people think they are getting an extremely good deal because more quantity for the same price. However, these items tend to be of low quality. As a result they may need to be constantly replaced and thrown away. This leads to a cycle of a company to sell, the consumer to buy, and to replace. In the process, these unwanted items are being thrown in landfills and polluting the Earth. As it mentions in, Bookmarks, Possessed by Our Possessions, “Passively buying into production practices that contribute to poisonous waste every time we go shopping depletes the earth in the process” (Cole 4). This statement is extremely accurate, especially in America. Although we have only 5% of the world’s population, we consume 30 percent of the world’s resources. And because of this, we also produce 30

While flipping idly through any magazine that can be picked off the rack, people are inundated with multiple ads. Each advertisement loudly clamors for the attention of its “target audience”, the people that will buy whatever product or service being sold. Unless you are willing to become a hermit to avoid advertising, manufacturers and their advertisements will target Americans to sell products that not everyone wants or needs. As a society, Americans are overexposed to advertisements and subsequently become inoculated against the usage of logic, unable or unwilling to perceive when an advertisements contain inaccurate or false information.

New employment agencies dealing with temp and contract workers face no shortage of challenges regarding profit margins. You need to meet your overhead costs (office rent and supplies, admin, compliance, etc.) and ensure that your team is securing target numbers for placements made.

Continuing, another negative effect of consumerism is it can lead to debt. In the past, people were unable to purchase the luxuries they wanted, so they were forced to focus more on their needs. Now, with the invention of credit cards, people can buy both what they need and want. This causes them to believe they have a never-ending supply of money, so they can buy more of the things they want. The financial crisis of 2008 left a lot of people trapped with payments due to the fact they lost their jobs, and interest rates went up. Moving on, advertisers often mesmerize their audience by making the product seem more desirable than it actually is. The advertisers often portray their items as something a person needs in order to keep their place in the social

Opportunity cost is the value of the next best alternative in a decision. Imagine that you have $150 to see a concert. You can either see "Hot Stuff" or you can see "Good Times Band." Assume that you value Hot Stuff's concert at $225 and Good Times' concert at $150. Both concerts cost $150 per ticket, but it would take you a couple of hours to drive to Hot Stuff's concert and you have to be in school (the next) morning for an exam. Good Times' concert is right here in town. Explain how you would assess the opportunity cost of seeing Good Times in concert. What is the opportunity cost of going to Good Times' concert?

Thinking critically and making decisions are important parts of today’s business environment. It is important to understand how the decision making process works and the steps involved. The nine steps of the decision making process are: identifying the problem, defining criteria, setting goals and objectives, evaluating the effect of the problem, identifying the causes of the problem, framing alternatives, evaluating impacts of the alternatives, making the decision, implementing the decision, and measuring the impacts. (Decision, 2007.) By using various methods and tools to assist in making important business decisions an individual can ensure the decisions they make will be as successful as possible. In this paper it

Most companies are profit oriented. Companies survive and live on profit. Even governmental institutions, NGO's and NPO's are profit oriented, what they do with profit is different though. Saying this means that companies seek always to be at a position where profit is maximized. As we know by now this happens when MC=MR but this is an always changing point as supply and demand are dynamic, effectively meaning that if firms get it right once they can't just do the same eternally, they still need to adapt to every market factor as a new change is a new reality all together that needs to be studied and addressed. All