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From course:

Economics A Level (DONEEEEEEE)

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Question:

Why do Firms even want Profits?

Author: eric_galvao



Answer:

-Used to pay Higher Wages to Ownders and Workers (Depends on Monospony Power) -Profit used for Reserach and Development. Profit can be used to ensure that it has Enough Money saved up in case of an Economic downturn, domestically or Internationally. -Firms on the Stock Market will need Profit in order to support a Good value of their Stocks. It can also make the Firm less vulnerable to Takeovers. Finally Shareholders interests can be fulfilled and can encourage New Investors


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