Faculties and Departments > BBA Discussion Forum
Cost minimization
Faiyaz:
Shibli Sir, I emphasized on profit maxization for one purpose only. And that is, if you want to increase your organization's profit, you need to balance it with an organization's liquidity. For example- If you invest money on share market, you are likely to lose it as it's uncertain (or you are investing on short term basis). But if you invest it on your business your risk may get big but your return may get bigger that you never know.
nature:
Dear Sir, Wealth Maximization is the objective of any financial managment.
Yousuf.Chy:
Wealth maximization can be done by maximizing the price of shares.
Cost Minimization can be done by increasing production efficiencies.
goodboy:
By investing the idle resources,minimize company contradiction.& procure more benefits can be helpful to maximize wealth..............
Faiyaz:
Although the topic is going far beyond it all started, I think I need to describe my point.
We all know that, we invest in different projects to increase our assets. And we supply money on business, thus it becomes capital to generate profit. Thats why, capital and profit are both seen as owners equity. For example- a person has 50,000 and he has 2 options. 1. He could invest it on share market and 2. He could capitalize it on his business. He takes the first option. And ironically, the share goes to OTC market over a time period. Now, this guy could only pity himself, thinking that he should have invested the bucks on his business since he can monitor the activities and thus his 50 thousand could bring him profitability at short time. So, in this case I think that, profit>wealth...
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