Profit Motive Definition

August 04, 2021

The profit motive pushes people to accomplish extraordinary things. Because of the profit motive people are induced to invent innovate and take risks that they may not otherwise pursue.

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When suppliers are not driven by the profit motive.

Profit motive definition. The desire for financial gain as an incentive in economic activity. The term is usually associated with the FIRM OBJECTIVE of PROFIT MAXIMIZATION but a profit motive would still exist where only satisfactory profits were aimed for. It is the profit motive that separates a business from a hobby which is an activity engaged in purely for self-satisfaction.

The incentive or desire to work or form a business in order to gain profit or make financial gains. In theory the profit motive distributes resources efficiently but in practice there are some problems. The profit motive is an economic concept which posits that the ultimate goal of a business is to make money.

The profit motive functions on the rational choice theory or the theory that individuals tend to pursue what is in their own best interests. What is PROFIT MOTIVE What does PROFIT MOTIVE mean PROFIT MOTIVE meaning PROFIT MOTIVE definition PROFIT MOTIVE explanationIn economics the profit motiv. They then sell them to the most people.

When suppliers are not driven by the profit motive they cease to be customer-oriented. A satisfactory society cannot be driven primarily by the profit motive or market forces. Definition of profit motive in English.

On the one hand it is said to. According to them greed is good. The objective of a FIRM to ensure that revenue exceeds costs.

Profit motive in British English. In capitalism it is generally considered to be the main reason most businesses exist and is closely tied to the concept of self-interest. In economics the term applies to a basic motivation that can be used to describe the expected behavior of firms individuals and markets such as the stock market.

Profit motive is also a technical term used by taxing. The profit motive is the desire to make money. The profit motive is the will to make money.

The desire to make a profit making decisions based on the profit motive. The desire for financial gain as an incentive in economic activity. Definition of profit motive.

Key Takeaways The profit motive refers to an individuals drive to undertake activities that will yield net economic gain. The profit motive drives businesses to come up with creative new products and services. The ability to earn profits as the reason for producers to make and sell goods.

Most important they must do it all in the most efficient manner possible. Notes for profit motive The profit motive is often called a great good or a great evil in society. A profit motive is quite simply the goal of most businesses to make a profit or have more money coming into the business than is spent by the business.

Motivation is the will to do things. The goal is to combine the profit motive with the need to arrest the. In a free market where people voluntarily swap money goods and services the profit motive decides who gets what.

Stated differently the reason for a businesss existence is to turn a profit. The profit motive is the incentive for businesses to strive to maximize profits. Most economists agree that the profit motive is the most efficient way to allocate economic resources.

Profit motive in this context means that you are aiming to achieve a real economic profit not just tax savings. See also PROFIT SATISFICING THEORY. Full Definition of Profit Motive In the free market economy the profit motive is the ultimate purpose of a commercial enterprise to earn a profit.

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