Artha Vijnana: Journal of The Gokhale Institute of Politics and Economics

D. P. Pandey

Abstract

The growth of individual firms in traditional economic theory was merely an indirect result of their profit maximisation and resource allocation function. Firms would grow only to achieve the 'optimum' level at which they would maximise profits. Therefore, in equilibrium, there would be no relation between various determinants, for example, profitability, financial policy and growth.

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