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Essay / Alternative Theories to Profit Maximization - 1736
Alternative Theories to Profit Maximization ranging from perfect competition to strict monopolies. Business and the Market Most businesses are profit oriented. Businesses survive and live on profit. Even government institutions, NGOs and NPOs are profit oriented, but what they do with profit is different. Saying this means that businesses always seek to be in a position where profit is maximized. As we now know, this happens when MC = MR, but this is an ever-changing point because supply and demand are dynamic, which effectively means that if companies are successful once they cannot do the same thing forever, they still have to adapt to each market factor as new change is a new reality that must be studied and addressed. All these changes occur in the so-called market, where suppliers and consumers meet to reach a level that suits the interests of both parties involved. Markets have four different structures that require different "attitudes" from suppliers in order to enter, to compete. and effectively gain market share. In competition, we can be in perfect competition, in monopolistic competition, in oligopoly or in monopoly [1]. Each of these structures guarantees different situations in terms of competition, from perfect competition where companies all compete equally in terms of threats and opportunities, in terms of homogeneity of the products sold, guaranteeing that each competitor has the same chance to compete. 'get a share. of the market, at the other end of the scale where we have monopolies in which a single company dominates the entire market, not allowing any other company to enter the market selling the product (or service) at its price. In all these cases, we also consider that...... middle of document ......05 Corruption Perceptions Index (CPI), [internet] Accessed: November 13, 2005, http://www.icgg .org/corruption.cpi_2005. html[3] Professional Jeweler Magazine Archives, De Beers Suspends Angola Operations, [internet] Accessed: November 13, 2005, http://www.professionaljeweler.com/archives/articles/2001/aug01/0801dn3.html[ 4] Angola News Online, Edition #16, June 8, 1998, [Internet] Accessed: November 13, 2005, http://www.africa.upenn.edu/Newsletters/angno16.html[5] Annual Industry Review diamond, De Beers signs new Angolan Agreement, [internet] Accessed: November 13, 2005, http://www.pacweb.org/e/images/stories/documents/addendum%20angola%202005-english.pdf[6 ] Professional Jewler Magazine Archive, Lev Leviev's Angolan Connection, [internet] Accessed: November 13, 2005, http://www.professionaljeweler.com/archives/articles/2002/feb02/0202dn1.html