Is profit maximization alone an appropriate goal for the firm? Why or why not? Who in a corporation is responsible for protecting and managing stockholders interest? How is profit maximization different from maximizing shareholder wealth?© BrainMass Inc. brainmass.com December 15, 2022, 5:49 pm ad1c9bdddf
No profit maximization alone is not an appropriate goal for the firm. The profit maximization has certain pitfalls as a criterion, which are as follows:
It is Vague
It Ignores the Timing of Returns
This brief solution looks at the weaknesses of profit maximization for usage in a firm's goal and explains the key difference between profit maximization and shareholder wealth. Reference used is included.