Three different objectives relate to a firm's profit,which is often measured in terms of return on investment.One objective,known as _________,is when a company gives up immediate profit in exchange for achieving a higher market share in the hopes of penetrating competitive markets.
A) maximizing current profit
B) target return
C) break-even strategy
D) minimizing risk
E) managing for long-run profits

Question

Quizplus · Accepted Answer

The objective described is managing for long-run profits, where the company sacrifices short-term profit to gain a higher market share and achieve long-term profitability. Option A, maximizing current profit, focuses on short-term gains without considering long-term sustainability. Option B, target return, specifies a particular level of profit without considering market conditions or competition. Option C, break-even strategy, aims to cover costs rather than maximizing profits. Option D, minimizing risk, focuses on reducing potential losses rather than maximizing profits.

Three Different Objectives Relate to a Firm's Profit,which Is Often