Profit maximization is
A)the only motive of any firm's management.
B)a behavioral assumption to simplify analysis.
C)the same as satisficing.
D)a literal description of a firm's behavior.

Question

Quizplus · Accepted Answer

Profit maximization is a simplifying assumption made by economists to analyze the behavior of firms. While it may be a goal of some firms, there are other factors that are taken into consideration by management such as long-term viability, social responsibility, and ethical considerations. Satisficing is a concept where a firm aims to achieve a reasonable level of profit, rather than maximizing it.

Profit Maximization Is