Doctor Zero is a regular contributer to Hot Air, and I've been a huge fan of his posts. This I consider "Economics for DUmmies"
So, hey DUmmies, "A world without profit is a world of poverty"
http://www.doczero.org/2010/06/a-world-without-profit/The concept of profit takes a lot of abuse from the Left. Democrats usually spit the word out as though it were a curse, especially when they’re working to increase government control over private industry. Our current economic malaise illustrate that, contrary to liberal rhetoric, the absence of profit does not lead to “shared wealth†or “economic justice.†A world without profit is a world of poverty.
What, exactly, is “profit?†Technically, it’s income minus expenses. This does not provide a complete understanding of the concept, however. If you’re one of the many people who lined up to buy a new iPhone last week, you can appreciate how the retailer made a profit – he paid a certain amount to purchase his inventory of iPhones, added in his overhead costs, and sold it to you for a few dollars more. His supplier made a profit from him in the same manner, in a chain of commerce which extends all the way back to the manufacturer.
However, it could be said that you also profited from this transaction. You acquired a device you could not possibly have built yourself, in exchange for the earnings from a few hours of your labor. You value this device more than the other things you could have bought with the money you paid for it. Your job allowed you to efficiently convert some of your time into the money you used to make the purchase. Every voluntary transaction produces a mutual increase in value – both parties benefit, or they would not perform the transaction. The dealer wanted your money, and you wanted that iPhone.
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