Economics (AS & A Level) · Oct / Nov 2021 · Paper 31 · Question 12
9708Differing objectives and policies of firms
In which circumstances are a firm's objectives most likely to differ from profit maximisation?
- Awhen a firm finances new investment largely by retained profits
- Bwhere firms are companies with very active shareholders
- Cwhere investment banks make takeovers easy to implement
- Dwhen a firm has many shareholders and is managed by employees
As printed in the paper
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Correct answer: D. when a firm has many shareholders and is managed by employees
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