Is the goal of zero profits for some finite period (three to five years for example) ever consistent with the maximization-of-wealth objective?

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2026-04-13 16:35

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Yes, the goal of achieving zero profits for a finite period can be consistent with the maximization-of-wealth objective if it is part of a strategic investment plan aimed at long-term growth. For example, a company may choose to reinvest all earnings into expansion, research and development, or market penetration to build a stronger competitive position, ultimately leading to greater wealth creation in the future. However, this approach must be justified by a clear strategy that demonstrates how the lack of profits will lead to increased value over time.

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