Which of the following statements about profit objectives is true?
A)Canadian firms have long been praised for their insistence on managing for long-run profits.
B)Profit objectives are frequently measured in terms of return on investment or return on assets.
C)Firms that are interested in strategic planning set their objectives to maximize current profit.
D)A target return pricing objective would only be used by a company that needs to attract more customers to survive.

Question

Quizplus · Accepted Answer

Profit objectives are often measured in terms of return on investment or return on assets, as these metrics help to assess the efficiency of an organization in generating profits from its investments. Choice A is incorrect because Canadian firms are not specifically praised for managing for long-run profits, although this may be a common objective for many firms. Choice C is incorrect because firms that are interested in strategic planning may set objectives that aim to maximize long-term profitability, rather than current profit. Choice D is incorrect because a target return pricing objective could be used by any company that has a specific profit target in mind, regardless of whether or not it is struggling to attract customers.

Which of the Following Statements About Profit Objectives Is True