Question

Visionary firms earn substantially higher returns than average firms because they acknowledge that profit maximizing is their primary reason for existence?

Answer 1

Visionary firms earn higher returns than average firms by prioritizing profit maximization and focusing on innovation.

Step-by-step explanation:

Visionary firms earn higher returns than average firms because they understand that profit maximization is their primary goal. These firms focus on innovation, finding ways to produce products more cheaply or creating products that consumers want. By continuously pursuing new innovation, visionary firms gain a temporary edge over their competitors, allowing them to earn above-normal profits before competitors catch up.