1. OBJECTIVE OF FIRM

2. PREPARED BY:
KAJAL GUJAR (18)
SHIVANI DUBEY (14)
MAYURI PUJARE (38)
TEJSWINI CHAVAN (9)
BERNALI BERA (5)
SEJAL SHIRKE (45)

3. DEFINITION
Firm:-
Firm is a business organisation that buys or hires
factors of production in order to produce goods and services
that can be sold at a profit.
Objective of firm:-The standard economic assumption
underlying the analysis of firms is profit maximization.
Firms are assumed to make decisions that will increase
profit. Generally speaking, profit maximization is the process
of obtaining the highest possible level of economic profit
through the production and sales of goods and services. For
a more thorough discussion of this topic, see the profit
maximization entry. Real world firms might pursue other
objectives including: (1) sales maximization, (2) pursuit of
personal welfare, and (3) pursuit of social welfare. In some
cases, these other objectives help a firm pursue profit
maximization. In other cases, they prevent a firm from
maximizing profit.

4. TYPES OF FIRM
- sole trader/proprietorship
- partnerships
- co-operatives
- private companies
- public limited companies
- state-owned firms
- multi-national firms

5. OBJECTIVE OF FIRM
Sales maximisation
Profit maximisation
Utility maximisation
Welfare maximisation
Growth maximisation
Objectives
of firm

6. SALES MAXIMISTION
According to prof. baumol the ultimate
objective of firm is sales maximisation rather
than the profit maximisation. He thinks that
when a firm considers sales maximisation as a
priority objective, it does not neglect the
objective of profit maximisation. The objective
of sales maximisation with minimum profit can
be easily understood with the Fig. Where:
TC- Total Cost.
TR- Total Revenue.
TP- Total product.

7. Sales Maximisation

8. PROFIT MAXIMISATION
It is yet another important objective guiding
the entrepreneur for the production of
goods. Profit plays crucial role in the
production decision taken by the firm.
According to the traditional theory that level
output which the maximum difference
between the total revenue (TR) and total
cost (TC) will help an entrepreneur
maximize his profit . It is depicted in the Fig.

9. Profit Maximisation

10. UTILITY MAXIMISATION
Utility or satisfaction remains the end objective of
human behavior. Taking this idea into
account, economists like Benjamin higgins was of the
view that small firms pursue the objective of utility
maximisation. It is also called as preference function
maximisation. According to this view the satisfaction
to the entrepreneur does not come only from the
maximisation of profit, but he may get this satisfaction
from the leisure which he is able to enjoy. The figure
help us…

11. Utility Maximisation

12. WELFARE MAXIMISATION
PERSONAL WELFARE:- The people who make decisions for a
business are, in fact, people. They have likes and dislikes. They
have personal goals and aspirations just like people who do not
make decisions for firms. On occasion these people use the firm
to pursue their own personal welfare. When they do, their
actions could enhance the firm's profit maximization or, in many
cases, prevent profit maximization.
SOCIAL WELFARE:- The people who make decisions for firms
also have social consciences. Part of their likes and dislikes
might be related to the overall state of society. As such, they
might use the firm to pursue social welfare, which could
enhance or prevent the firm's profit maximization.

13. GROWTH MAXIMISATION
A famous U.S. economist J.K.Galbraith made an
empirical study of big corporation and came to the
conclusion that managers pursue not single but
multiple goals such as sales maximisation, utility
maximisation etc. along with these
objective, managers keep the prime objective to
achieve the top level or the highest possible level of
growth in output. They also try to improve their
prestige, technical superiority and market power. They
take the help of effective advertising on a large scale to
influence the consumer in order to attain the above
mentioned objective.

14. OBJECTIVE S OF TOP COMPANIES
APPLE
RELIANCE
INDIAN OIL
SAMSUNG

15. APPLE LTD.
 To
expand their sales to customers who have not yet own
any Apple’s products.
 To produce hassle free products that provides service and
enjoyment for customers.
 Become the leading business in the mobile market.
RELIANCE LTD.
 Create
synergetic effect by creating high quality and
diversified portfolio.
 Provide diversified financial services with focused people.
 Diversification of sources of fund.
 Enhance Corporate value through sustained growth.

16. INDIAN OIL CO. LTD.
 To
serve the national interests in oil and related sectors in
accordance and consistent with Government policies.
 To maximize utilization of the existing facilities for improving
efficiency and increasing productivity.
 To earn a reasonable rate of return on investment.
 To serve the national interests in oil and related sectors in
accordance and consistent with Government policies.
SAMSUNG COMPANY
 To
extend amongst members the knowledge and appreciation of
computers, automatic data processing systems and Computer based
automatic control system, and of theory.
 To foster an informed public opinion regarding computation and
computing machinery and techniques .
 To take interest in the general professional welfare of the members.
 To do such other things as the Society may think incidental or
conducive to the attainment of the objects of the Society.

17. THANK YOU…!