Explanation:

Profit maximization refers to a tendency of business firms to maximize profits in the short or long run by using the most efficient methods and equalizing the marginal cost and revenues. Its main purpose is to increase the level of production of a firm or business that will grant it the maximum profit on selling goods and services.

• Profit maximization means increasing profits by the business firms using a proper strategy to equal marginal revenue and marginal cost. This theory forms the basis of many economic theories.

• It is present in a monopoly and perfect competition market.

• The profit maximization formula depends on profit = Total revenue – Total cost. Therefore, a firm maximizes profit when MR = MC, which is the first order, and the second order depends on the first order.

• This concept differs from wealth maximization in terms of duration for earning profit and the firm’s goals.

Hence option 2nd is correct.