What are the Objectives of the Firms?

1) The traditional economic theory has assumed that the typical firm has a single objective, to maximize profits.

2) The modern theories of the firm, however, do acknowledge that firms may have other objectives such as

i) Sales revenue maximization (market power)

ii) Or maximization of managerial utility (skill power).

iii) Shareholder wealth maximisation.

iv) Welfare maximization.