ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -The profit motive refers to an individual’s drive to undertake activities that will yield net economic gain. Because of the profit motive, people are induced to invent, innovate, and take risks that they may not otherwise pursue.

Detailed explanation-2: -Profit is the basic motivation for any business, but it has to be tempered with humanity, respect and ethics. There’s a real danger for allowing businesses to run purely based on the idea that more is better.

Detailed explanation-3: -When someone experiences profit motive, they’re taking action to make money, and this can distribute wealth to others. For example, if a person starts a business because of the profit motive, the people they hire to work with them or their investors can experience an addition to their wealth as well.

Detailed explanation-4: -An economic profit is the difference between the revenue received from sales and the explicit costs of producing its goods and services, as well as any opportunity costs. Opportunity costs are a type of implicit cost determined by management and will vary based on different scenarios and perspectives.