BUSINESS ADMINISTRATION
BUSINESS ENVIRONMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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return profits to the owners of the business.
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donate profits to a local or national charity.
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break even on costs and revenue
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establish salaries and benefits for its employees
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Detailed explanation-1: -A for-profit organization is one that operates with the goal of making money. Most businesses are for-profits that serve their customers by selling a product or service. The business owner earns an income from the profit and may also pay shareholders and investors from the profits.
Detailed explanation-2: -The purpose of a business is to organize some sort of economic production (of goods or services). Businesses can be for-profit entities or non-profit organizations fulfilling a charitable mission or furthering a social cause.
Detailed explanation-3: -In 1970, Milton Friedman famously argued that the only social responsibility of business was to maximize profits (Friedman 1970). These profits, if only returned to the firm’s owners (the shareholders, on whose behalf the management should rightfully act), could be put to charitable purposes as shareholders saw fit.
Detailed explanation-4: -There are three main measures of profit. These are gross profit, operating profit and net profit.