'Profit is not an objective but a requirement of businees', Do you agree with this statement? Explain.
'Profit is not an objective but a requirement of businees', Do you agree with this statement? Explain.
Yes, I agree with this statement. A business must earn profit because of the following reasons :
(a) For long-term survival : Profits alone helps a business to continue to exist for a long time. A business in which the profit is meagre or no profit is earned, closes down quickly.
(b) For rapid growth : Profit provides a sound financial structure for the growth and expansion of the business.
(c) Increses the efficiency of business: It acts as an incentive, motiving workers to contribute their maximum worth to the enterpise. Profit increases with the increase in efficiency and improvesd performance of the organisation.
(d) For building reputation and recognition : If the business earns adequate profits, it will pay fair and competitive rates to its employees, dividends at competitive rates to shareholders, etc. In other words, all the parties can be satisfied. This helps the business to earn reputation and goodwill in the society.
Yes, I agree with this statement. A business must earn profit because of the following reasons :
(a) For long-term survival : Profits alone helps a business to continue to exist for a long time. A business in which the profit is meagre or no profit is earned, closes down quickly.
(b) For rapid growth : Profit provides a sound financial structure for the growth and expansion of the business.
(c) Increses the efficiency of business: It acts as an incentive, motiving workers to contribute their maximum worth to the enterpise. Profit increases with the increase in efficiency and improvesd performance of the organisation.
(d) For building reputation and recognition : If the business earns adequate profits, it will pay fair and competitive rates to its employees, dividends at competitive rates to shareholders, etc. In other words, all the parties can be satisfied. This helps the business to earn reputation and goodwill in the society.
