Question

1. what is wealth maximization
2. why is wealth maximization considered as better measure than profit maximization
3. what are the conflicts in profit and wealth maximization principles
4. why is profit maximization consistent with wealth maximization
5. what are the essential difference between the profit maximization and the wealth maximization

Answer 1

Answer:

economic

Explanation:

i am not a economy student but I need points so sorry

Answer 2

Answer:

Explanation:

1.Wealth maximization is the concept of increasing the value of a business in order to increase the value of the shares held by stockholders. ... The most direct evidence of wealth maximization is changes in the price of a company's shares.

2.Wealth maximization is superior than profit maximization because the main business concern under this concept to improve the value or wealth of the shareholder

3.Conflict Profit Maximization S Its main objective is to earn large amount of profits. S It emphasizes short term S It ignores time value of money. S It ignores risk and uncertainty. S It ignores timimg of return Wealth Maximization S Its main objective is to achieve highest market value of common stock.

4.Profit maximization is not consistent with wealth maximization. ... Therefore wealth maximization is superior because it is a long term objective and considers the time value of money by discounting cash flows to the present time.

5.Profit maximization vs. wealth maximization. The essential difference between the maximization of profits and the maximization of wealth is that the profits focus is on short-term earnings, while the wealth focus is on increasing the overall value of the business entity over time