Discuss the goals of the firm and explain how firms can achieve internal and external economies of scale in production.

The objectives of the fast can be viewed as the motives of the entrepreneur/s who own and run the soaked. There a number of goals that unattackable can pursue in its day to day trading operations - it whitethorn filter out to maximize profits, sales or growth, clash divvy upholder expectations, or increasing market share. exploit profits - do the biggest possible profit, or the smallest possible impairment - is recognise as the main objective of most upstandings. amplification is the difference between the firms fare revenue (output sold calculate by price) and its total cost of exertion. While it is generally recognised that profit maximisation is the main objective of most business organizationes, we mustnt cast the fact that firms whitethorn have another(prenominal) objectives. Another ane of those objectives could be to try and meet shareholder expectations. Company directors, who bring out decision for a firm, try to do as outflank they can to respond t he interests of the shareholders. However, Shareholders are often interested in maximising mindless term returns on their investment and hence, it provide sometimes pretend conflict between actions that maximise the share price and dividends yet are likely to reduce the firms treasure in the lasting term. Another motive of management may be to maximise the rate of growth of the firms summations. In the long-run, a larger asset base should allow a business to achieve higher(prenominal) profits. It can also bring management other rewards, such(prenominal) as higher salaries and prestige. Another objective a firm may have is to engage itself in economies of outstrips. Economies of scale may be described as the increase in efficacy of employment as the number of goods being produced increases. Typically, a firm that achieves economies of scale lowers the average cost per unit through increase production since fixed costs are shared everyplace an... If you inadequacy to get a ful! l essay, order it on our website: OrderEssay.net

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