Firms Must Be Aware of Goals Other Than Short-Term Profit

question 104

Multiple Choice

Firms must be aware of goals other than short-term profit maximization.One area of concern should be social responsibility,which is the

• A) expectation that business will strive to improve the overall welfare of society.
• B) idea that organizations are solely responsible to local citizens.
• C) fact that court costs could impact the financial bottom line.
• D) idea that businesses are responsible for maintaining a healthy social climate for their employees.

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Definitions:

Widgets

A general term commonly used to describe any theoretical produced item or merchandise.

Economically Efficient

Refers to a situation where resources are allocated in a way that maximizes the net benefit to society.

Revenue

The income generated from normal business operations and includes discounts and deductions for returned merchandise.

Consumer Sovereignty

The principle that the consumer's preferences determine the production of goods and services within an economy.