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17 September, 2021

What are the main objectives of a firm in the private sector

 Basically the main key objective of the private sector is to get the highest profit as much as they can get. The profit is the Earning before interest and tax. Taxes are government sanctioned and the private sector tries to give a great cushion to EBIT against interest and tax. To achieve this aim, the companies in the private business produce, where their total revenues are far higher than total costs. This creates high reserves for the stockholders.

This indicates that the private sector has to accomplish the goals and desires of the shareholders and it will always aim to fulfil their satisfaction. Another objective of companies in the private sector is to raise their market shares to get a sustainable competitive advantage. Companies involved in the private sector also strive to improve their corporate image by showing social responsibility. In addition, the private sector is highly involved in sponsoring and participating in social and community events because they know that such events can make their positioning and image better in the market