GK
BUSINESS ECONOMICS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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A business with the main purpose of gaining profit is called ____
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Autonomy
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Big Idea
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Profitability
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Scalability
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Explanation:
Detailed explanation-1: -Profit equals a company’s revenues minus expenses. Earning a profit is important to a business because profitability impacts whether a company can secure financing from a bank, attract investors to fund its operations and grow its business. Companies cannot remain in business without turning a profit.
Detailed explanation-2: -Profitability and profit are often confused as being the same but they are, in fact, different. Profitability is a financial metric that companies use to determine how successful they are. This is a relative measurement and is normally expressed as a ratio. Profit, on the other hand, is an absolute measurement.
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