:The profit maximization assumption states that a firm will produce at the output rate " x " if that rate maximizes the firm's profit.
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In the "'neoclassical accelerator model "'of Jorgenson, the desired capital stock is derived from the aggregate production function assuming profit maximization and perfect competition.
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The profit maximization conditions can be expressed in a " more easily applicable " form or rule of thumb than the above perspectives use.
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The interval scheduling problem can be viewed as a profit maximization problem, where the number of intervals in the mutually compatible subset is the profit.
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Additionally, the private companies tended to focus more on profit maximization than on the quality and quantity of service provided because water is a natural monopoly.
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Alchian concludes that, despite uncertainty and the lack of knowledge by market participants, economists can still analyze the behavior of firms using the assumptions of profit maximization.
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A unifying theme is the attempt to optimize business decisions, including unit-cost minimization and profit maximization, given the firm's objectives and constraints imposed by technology and market conditions.
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Koo wrote in 2010 that firms may switch from a profit maximization objective to debt minimization until they are solvent ( i . e ., equity is positive ).
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For example, profit maximization lies behind the neoclassical theory of the firm, while the derivation of demand curves leads to an understanding of consumer goods, and the reservation demand.
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The firm decides what amount of the total output to sell in each market by looking at the intersection of marginal cost with marginal revenue ( profit maximization ).
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