Question

Explain the Relationship between Profitability and other objectives of business

Answer 1

Explanation:

Profitability is the ability for a business to earn a profit. A profit is simply the revenue left over after you have paid all the costs and expenses related to your business activities. Profitability ratios are a series of metrics that you can use to measure the relative profitability of a business.

Profit Maximisation.

Higher profits enable a firm to pay higher wages, more dividends to shareholders and survive an economic downturn. Many other objectives such as corporate image an increasing market share can be a way to maximise long-term profit.