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Profitability study

Jump to navigation Jump to search This article is about profit in economics and political economy. This article may be profitability study technical for most readers to understand.

Please help improve it to make it understandable to non-experts, without removing the technical details. In economics, profit in the accounting sense of the excess of revenue over cost is the sum of two components: normal profit and economic profit. The enterprise component of normal profit is the profit that a business owner considers necessary to make running the business worth his or her while, i. Only in the short run can a firm in a perfectly competitive market make an economic profit.