Here is the synopsis of our sample research paper on PROFIT MAXIMIZATION HYPOTHESIS AND MANAGEMENT BEHAVIOR. Have the paper e-mailed to you 24/7/365.
Essay / Research Paper Abstract
This 3-page paper discusses how management behavior can be tied into the profit maximization theory. Bibliography lists 2 sources.
Page Count:
3 pages (~225 words per page)
File: D0_MTprofmahy.rtf
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Unformatted sample text from the term paper:
act the ways they do. In a perfect world, managers would align perfectly to a firms objectives, which are to generate, and maximize, profits (Keat and Young, 2006). The idea
that a firm exists to maximize profits is the core and definition behind the profit maximization hypothesis (Keat and Young, 2006).
But managers behaviors dont always fit to the norms of the profit maximization hypothesis of a company - many managers postulate market share, revenue growth and increase in shareholder value
as important goals of a firm as well (Keat and Young, 2006). Keat and Young also point out that other economic goals of the company may involved market share, growth
rate, returns on investments and assets, or profit margin (Keat and Young, 2006). Then there are the non-tangible, non-economic goals, such as providing quality products and services, providing a positive
work environment for employees and being a good corporate citizen (Keat and Young, 2006). There is also the argument that the companies owners (i.e., the shareholders) dont own huge chunks
of the company and arent going to go nuts if absolute profit maximization doesnt take place (Keat and Young, 2006). In fact, the argument also goes that shareholders arent going
to much care, so long as their stocks in the particular company are performing well (Keat and Young, 2006). But there
are some arguments that support the fact that managers will, at times, support the profit maximum hypothesis. For one thing, because institutions and other large holders have large chunks of
stock in a given company, theyll hire analysts to judge a companys prospects, based on the balance sheet, cash flow and so on (Keat and Young, 2006). Stock prices, therefore,
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