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Assertion states that the profit objective is not unethical. Reason states that reasonable profit helps the survival and growth of an organisation. Choose the correct option.

Answer and explanation

Correct answer: Both assertion and reason are true, and the reason is the correct explanation

The governing concept is the objective of management and the legitimate place of profit in organisational survival. Profit is not automatically unethical; it becomes objectionable when it is earned through exploitation, fraud, unsafe products, or other unfair practices. A reasonable profit, earned lawfully and ethically, provides funds for replacing assets, paying employees and suppliers, facing risks, improving products, and financing future expansion. Therefore the assertion is true. The reason is also true because an organisation cannot normally survive and grow for long if its revenue does not cover costs and provide a reasonable surplus. The reason directly explains why the profit objective, when pursued ethically, is valid. Hence option A is correct; the other options incorrectly deny one or both statements.

Related tags

Management ObjectivesProfitAssertion ReasonObjectives Of ManagementNature And Significance Of ManagementBusiness StudiesClass 12 Mcq

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