Wealth Maximization is considered as a better approach than profit Maximization because Wealth maximization objective is a widely recognized criterion with which the performance a business enterprise is evaluated. It has also some advantages such as,// 

1. Wealth maximization is a clear term. Here, the present value of cash flow is taken into consideration. The net effect of investment and benefits can be measured clearly. (Quantitatively)//

 2. It considers the concept of time value of money. The present values of cash inflows and outflows helps the management to achieve the overall objectives of a company.// 

3. The concept of wealth maximization is universally accepted, because, it takes care of interests of financial institution, owners, employees and society at large.// 

4. Wealth maximization guide the management in framing consistent strong dividend policy, to earn maximum returns to the equity holders.// 

5. The concept of wealth maximization considers the impact of risk factor, while calculating the Net Present Value at a particular discount rate, adjustment is made to cover the risk that is associated with the investments.