PORTER’S GENERIC STRATEGIES

Micheal Porter’s Generic strategies state that Irrespective of Industry attractiveness, a firm in any industry may want to gain high market share and position itself higher than its competitors. This can be done mainly in two ways – Either by providing the product at a lower cost than its competitors or by offering a differentiated product Famous author Micheal Porter in Read More …

Capital Budgeting: Meaning, Nature and Process

Meaning Capital Budgeting decision is considered most important and most critical decision for finance manager. It involves decisions related to long-term investments of capital nature. The returns from such investments are scattered over a number of years. Since it requires huge amount of funds, it is considered irreversible. Some examples of capital budgeting decisions are Purchase of new plant and Read More …

Wealth Maximization Objective

Wealth Maximization Objective is also known as “Value Maximization” or “Net Present Worth Maximization.” This objective is considered appropriate for decision making. Wealth means the wealth of shareholders. The wealth of shareholders is determined by the market value of shares. Wealth also signifies Net Present Value(NPV) which is the difference between the present value of cash inflows and the present Read More …

Profit Maximization objective of Financial Management

Profit Maximization is implied objective of any business activity. Every business activity is started with the ultimate aim of making profit. Profit maximization objective of financial management means that all financial decisions are made with a view to maximize profit of the firm with all its investments and savings. This objective helps in measurement of economic performance and efficiency of Read More …