Which of These Is a Reason Why Achieving the Maximum

question 49

Multiple Choice

Which of these is a reason why achieving the maximum possible profit in a particular year may not be in the best interests of a business?

• A)Concentrating on the short-term may have detrimental effects in the long-term.
• B)It may be achieved by causing environmental problems, which give the business a bad reputation.
• C)If it is achieved with high-risk strategies, such as excessive reliance on borrowings, it could lead to disaster in the longer term.
• D)All of the above.

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Definitions:

Substitution Effect

refers to the change in consumption patterns due to a change in relative prices, leading consumers to substitute more expensive goods with cheaper alternatives.

Money Income

The total amount of monetary earnings or receipts accruing to an individual or household within a specified period.

Demand Change

Variations in the quantity of a product that consumers are willing and able to purchase at various price levels over a period.

First Class

Describes the highest quality or most expensive service, accommodation, or means of transportation available.