1.

Explain how an improper price policy results in the poor performance of public sector enterprises.

Answer»

(i) The basic aim of the Public Sector is public welfare and economic development. 

(ii) Due to this Public Sector keep the prices of their products low. Some time lowers than the cost of production. 

(iii) This lowers the profit margin. 

(iv) Lower profit margin leads to lower capital formation and ultimately still lower profits.



Discussion

No Comment Found

Related InterviewSolutions