explain bamouls theory of sales maximization? mba
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Explanation:
Baumol's Sales Revenue Maximization Model. Sales maximization model is an alternative model for profit maximization. This model is developed by Prof. Boumol, an American economist. ... It states that the goal of the firm is maximization of sales revenue subject to a minimum profit constraint.
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the modal is based on the following assumptions.
1. there is a single period time horizon of the firm.
2.the firms aim at maximization it's total sales revenue in the long run subject to the profit constraints.
3. the firm's minimum profit constraints is set competitively in terms of the current market value of it's shares.
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